All Forum Posts by: Karl Lueders

Update to selling non-FHA approved condos to buyers with less than 20% down:
- Buyer must be stalwart
- Building must be stalwart
- Owner-occupancy must be over 70%!!!

To the last point, the loan underwriter only needs it to be >50%. The MI underwriter needs it to be >70%.

Just learned that today. I'm so far behind.

Matthew: To piggyback on J Scott's solid advice, a great Realtor will also be able to effectively communicate news you need to hear, whether it be as a buyer's or listing agent. The truth goes a long way to save you time and money; helping a client avoid making a bad deal is as valuable as finding a great one. Being a yes man doesn't get you very far.

Suppose we should figure out how to represent, especially since the Bigger Pockets Expo is going to be in Denver.

I think you forgot Pain, which follows Collapse and precedes Agony.... lol. Actually, it's what I kind of assumed, Chris. Either cash or go non-warrantable through a portfolio lender as long as the buyer wants to put 20% down. But who wants to put 20% down on a condo???

Do the underwriting guidelines vary based on the bank? And when there's an MI company involved, I get the feeling that MI guidelines are even tighter. Should I assume that unless you're 740+ with 20% down, that you won't get a loan on a condo? I'm in Denver, btw.

I didn't read the whole thread on here, but I had a situation where I suggested to my client - landlord/seller - that she consider allowing the buyer to move into her condo unit a week prior to close. The reason being is that I discovered that the 48-unit building was being scrutinized heavily by a litany of lenders that the buyer tried to enlist to get financing, only to have each lender deny the loan based on their own unique criteria. The buyer had good credit and 10% down ($200k sale price), but the MI companies and the banks were denying the loan based on their own definitions of owner-occupancy ratios and retail ratios. There is a whole second layer to this story, but the bottom line is that I sensed that most lenders - non-warrantable included - were going to have an issue pushing an approval through. Currently, the failed buyer lives in the unit and pay rent month-to-month. The seller is going to relist in 2012 after the holidays.

This is Karl Lueders in Denver. I've been a member for a few years but have resurfaced to connect with folks in Denver and beyond. I'd like to see if the Denver Real Estate group is still active or not, as well.