This topic was discussed very lightly in a thread somewhere back on this site, but we thought it deserved front page attention. From “the Banker”:
I have found that there is a tremendous amount of uncertainty and recent questions in reference to all of the Condo Guidelines and Approval Changes that are directly hitting the San Francisco condo market. I will note that these rules are those issued by the Government Sponsored Enterprises, Fannie Mae and Freddie Mac.
There are exceptions to the rules and [my bank] does have certain projects approved, or grandfathered in before all of the changes. Also, because of the relationship [my bank] has with the Agencies, we also have the ability to request for Exceptions. This is a major advantage that [we have]!!!!
Here is a list of some of the new, potential pitfalls:
-New construction financing is being increased from 51% to 70%, again if not grandfathered in or currently approved
-No more than 15% of the projects’ units can be 30 or more days delinquent on HOA dues
-The project cannot have more than 20% commercial space
-Fidelity Insurance is required for Condos with 20 or more Units
-No more than 10% of the project can be owned by one entity
-A HOA must be in control for at least 1 year
Again, these are the guidelines and exceptions can be made.
As always, if you have more questions, feel free to drop us a line (firstname.lastname@example.org), or make a comment below. If you’d like to get in touch with “the Banker”, that can be arranged as well.