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Non-Warrantable Condo Loans: Financing for Unique Condominiums

Non-warrantable condo loans are designed for borrowers who want to finance condominiums that don't meet Fannie Mae and Freddie Mac guidelines.

If you're looking to purchase a unique condo with special circumstances, this program could be your path to homeownership.

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What is a Non-Warrantable Condo Loan?

Definition
A non-warrantable condo loan is a specialized program that finances condominiums that don't meet Fannie Mae and Freddie Mac guidelines. These loans help you purchase condos with unique characteristics such as high investor concentration, pending litigation, incomplete construction, or special circumstances that make them ineligible for conventional financing.
How it works
These loans use specialized underwriting that understands the unique characteristics of non-warrantable condos. Lenders evaluate the condo's financial health, HOA governance, occupancy rates, and your ability to maintain the property while considering the condo's specific issues.
Key advantage
Non-warrantable condo loans bypass traditional lender restrictions on unique condos by using specialized underwriting that understands the specific characteristics and risks of non-conforming properties, making unique condo ownership accessible when conventional lenders cannot accommodate them.
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How Non-Warrantable Condo Loans Work

These loans use specialized underwriting that understands the unique characteristics of non-warrantable condos. Lenders evaluate the condo's financial health, HOA governance, occupancy rates, and your ability to maintain the property while considering the condo's specific issues. The process includes specialized condo review and financial analysis.

Basic Non-Warrantable Condo Loan Eligibility

You may be eligible for a non-warrantable condo loan if you have:

  • 700+ credit score
  • 25% down payment
  • Stable employment
  • Condo in good financial condition

Common Non-Warrantable Condo Loan Eligibility Requirements

Credit score:
700 FICO score
Down payment:
25%
Employment:
Stable employment and income
Loan amounts:
Up to $2,000,000
Reserves:
6 months of reserves
Condo financials:
HOA in good financial condition
Litigation:
No pending litigation against HOA
Occupancy:
May have high investor concentration
Construction:
May be new construction or incomplete
Property type:
Non-warrantable condos only

Did you know: Non-warrantable condo loans can help you qualify for up to $2,000,000 in financing.


Why You Need Another Lender

If you've been denied a mortgage for a unique condo, you're not alone. Many traditional banks simply don't offer programs designed for non-warrantable condos. They rely on standard underwriting that requires condos to meet strict Fannie Mae and Freddie Mac guidelines, which doesn't accommodate the unique characteristics of many desirable condominium properties.

Your first bank just doesn't offer the right program for you.

Think of it like when a customer asks for something your business doesn't offer. Maybe they want delivery but you only do pickup, or they need a service you don't provide. You're not saying no because there's anything wrong with them—you just don't offer that particular service. Same with mortgages. Traditional banks work great for most people, but they don't offer the programs that non-warrantable condo buyers need.

Traditional banks use conventional underwriting that works well for standard condos but struggles with unique properties. Your condo may have special circumstances like new construction, high investor concentration, or pending litigation, but conventional programs may not understand the value and potential of these unique properties. They see the non-conforming characteristics and can't approve you, even though the condo may be perfectly suitable for your needs.

Non-warrantable condo loans are perfect for buyers of new construction condos with insufficient sales, investors purchasing in high investor concentration buildings, buyers of condo hotels or resort properties, those purchasing in buildings with pending litigation, or anyone wanting to purchase condos with special circumstances.

This isn't about finding loopholes or gaming the system. It's about working with lenders who understand that unique condos can be excellent investments and homes. Non-warrantable condo loans are offered by lenders who work with unique properties every day. They look at your current situation—your stable income, strong credit, and the condo's specific characteristics—rather than just the non-conforming aspects.

For a no obligation conversation about your mortgage, contact Coby Matush (#1531494) of Novus Home Mortgage at 724-787-7778.


Example Use Cases and Scenarios


Did you know: Non-warrantable condo loans accept unique property characteristics for qualification.


How Do Non-Warrantable Condo Loans Work?

Non-warrantable condo loans follow the same basic mortgage process as conventional loans, with one key difference: condo-specific underwriting. This specialized approach allows buyers to qualify for unique condos by evaluating the property's specific characteristics and financial health.

The Non-Warrantable Condo Loan Process

1. Condo Review & Assessment Process
The process begins with condo review where lenders examine the HOA financial statements, governing documents, and occupancy rates, followed by financial analysis to evaluate the condo's overall financial health and marketability. Lenders then complete property assessment to understand the specific non-warrantable characteristics, then finalize the eligibility determination based on your overall financial profile and the condo's unique situation. This process typically results in qualification for unique condos that may be denied by conventional lenders.
2. Standard Mortgage Process
Everything else follows the same process as conventional loans: credit check with minimum 700 FICO score, property appraisal using specialized condo appraisal, title search to ensure clear property ownership, and standard mortgage documentation including loan application, disclosures, and insurance requirements. The only difference is how the condo is evaluated - everything else uses identical underwriting standards and consumer protections.
3. Underwriting
Experienced underwriters review your complete profile using condo-specific assessment instead of traditional property evaluation. They assess your creditworthiness including income stability and debt-to-income ratio, property value through specialized condo appraisal and market analysis, and ability to maintain the property based on the condo's unique characteristics. The underwriting process includes the same risk assessment, just with specialized condo evaluation.
4. Approval & Closing
Once approved, the closing process is identical to conventional mortgages. You'll sign the same documents including promissory note, deed of trust, and closing disclosure, pay the same types of fees such as origination, appraisal, and title insurance, and receive the same level of consumer protection including RESPA disclosures and right of rescission for refinances. The loan terms, interest rates, and repayment structure follow standard mortgage industry practices.

Non-Warrantable Condo Loans vs Conventional Mortgages

Understanding the key differences between non-warrantable condo loans and conventional mortgages can help you choose the right financing option for your situation.

FeatureNon-Warrantable Condo LoansConventional Loan
Who QualifiesBuyers of non-warrantable condos, new construction buyers, investors in high investor concentration buildings, and those purchasing unique condo developmentsW-2 employees, salaried workers
Income DocumentationW-2s, pay stubs, tax returns, bank statements, and condo financial documentationW-2s, pay stubs, tax returns
Minimum Credit Score700 FICO score620
Minimum Down Payment25% down payment3%
Private Mortgage InsurancePMI required for loans with less than 20% equityPrivate mortgage insurance (PMI)
Occupancy TypePrimary residences, second homes, and investment propertiesPrimary residences, second homes, investment properties
Property TypeNon-warrantable condominiums onlySingle-family homes, condos, townhouses, 2-4 unit properties
Loan LimitsUp to $2,000,000 depending on income and down payment$766,550 (2024)
Interest RatesAbove market ratesMarket rates
Processing TimeAs few as 3 weeks30-45 days
Closing CostsSimilar to conventional loans, may include additional processing fees2-5% of loan amount
Prepayment PenaltyNoneNone
Reserves Required6 months of reserves typically required2-6 months of PITI
Debt-to-Income RatioUp to 45%Up to 43%
Maximum Loan Amount$2,000,000$766,550
Appraisal RequirementsSpecialized appraisal considering condo financialsStandard appraisal required
Occupancy RequirementsPrimary residence for 12 monthsPrimary residence for 12 months

Real-World Example: Non-Warrantable Condo Loans

This video is AI generated and does not represent an actual customer.

The Software Engineer's Journey to New Construction Condo Ownership

A talented software engineer had been dreaming of buying a condo in a new development for months. With a stable position at a major tech company earning $120,000 annually, she felt confident about her financial situation. She had saved $87,500 for a down payment and found her perfect condo—a modern 2-bedroom unit in a new development listed at $350,000.

However, her mortgage application hit a major roadblock when the lender reviewed the condo's characteristics. The building had only 40% of units sold, which didn't meet Fannie Mae's requirement of 70% owner-occupancy for new construction. Despite having excellent credit (720 score), stable employment, and substantial savings, the conventional lender denied her application because the condo didn't meet warrantable guidelines.

Frustrated but determined, she began researching alternative financing options and discovered that another lender offered non-warrantable condo loans. This program would evaluate the condo's specific characteristics and her strong financial profile rather than just the non-conforming aspects. By focusing on her stable income, excellent credit, and the condo's marketability, the alternative lender was able to qualify her for a $262,500 loan with a 25% down payment.

The process was straightforward: she provided proof of stable employment, bank statements for down payment verification, and the condo's HOA financial statements. Within three weeks, she received approval and was able to purchase her dream condo. The slightly higher financing costs were a small price to pay for achieving her homeownership goals in the new development.

This story illustrates how non-warrantable condo loans can provide access to unique properties for buyers with strong financial credentials, making condo ownership possible when traditional lenders cannot accommodate the property's special circumstances.

Did you know: Non-warrantable condo loans require only 25% down payment.

Benefits & Considerations

Non-warrantable condo loans offer significant advantages for unique property buyers, but they also come with important considerations to weigh.

Key Benefits: Unique property access, specialized underwriting, flexible requirements
Unique property access
Qualify for condos with special characteristics that don't meet conventional guidelines, including new construction, high investor concentration, or pending litigation.
Specialized underwriting
Lenders understand the unique characteristics of non-warrantable condos and evaluate them appropriately rather than applying rigid conventional standards.
Flexible requirements
Programs accommodate various non-conforming characteristics while still maintaining appropriate risk assessment and borrower qualification.
Large loan amounts
Up to $2,000,000 depending on your income and down payment, making it possible to purchase the condo you want.
Multiple occupancy types
Primary residences, second homes, and investment properties are all eligible, giving you flexibility in your real estate goals.
Proven solution
Thousands of buyers have used this program successfully to achieve condo ownership in unique properties.
Important Considerations: Higher costs, condo requirements, specialized evaluation
Higher costs
Financing costs are typically 1-2% higher than conventional loans due to the specialized nature of the program and condo-specific risk assessment.
Down payment
Minimum 25% down payment required, which is higher than conventional loan options.
Credit requirements
700 credit score or higher needed, with demonstrated financial stability and ability to maintain the property.
Condo requirements
Condo must be in good financial condition with no pending litigation that would significantly impact the property's value.
Lender availability
Not all lenders offer this specialized program, so you'll need to work with lenders who understand non-warrantable condo requirements.

Frequently Asked Questions About Non-Warrantable Condo Loans

Get answers to the most common questions about non-warrantable condo loans. Whether you're wondering about qualification requirements, condo characteristics, or how the process works, we've covered the essential information below.

What is a non-warrantable condo loan?
A non-warrantable condo loan is a specialized program designed for condominiums that don't meet Fannie Mae and Freddie Mac guidelines.
How do non-warrantable condo loans work?
These loans use specialized underwriting that understands the unique characteristics of non-warrantable condos. Lenders evaluate the condo's financial health, HOA governance, occupancy rates, and your ability to maintain the property while considering the condo's specific issues.
Who qualifies for non-warrantable condo loans?
Buyers of new construction condos with insufficient sales, investors purchasing in high investor concentration buildings, buyers of condo hotels or resort properties, those purchasing in buildings with pending litigation, and buyers of unique condo developments. You need stable income and typically a 25% down payment.
What documents do I need for a non-warrantable condo loan?
You'll need W-2s or pay stubs for income verification, as few as 2 months of bank statements for down payment verification, condo financial statements and HOA documents, property appraisal, and documentation showing the condo's compliance with non-warrantable guidelines.
How much can I borrow with a non-warrantable condo loan?
Loan amounts can go up to $2,000,000 depending on your income, down payment, condo value, and the specific characteristics of the condo. The exact amount considers both your financial profile and the condo's unique situation.
What credit score do I need for non-warrantable condo loans?
Most non-warrantable condo loan programs require a minimum credit score of 700, though some lenders may be flexible for borrowers with strong income and substantial down payments. Higher credit scores typically result in better interest rates and terms.
What makes a condo non-warrantable?
Condos become non-warrantable due to factors such as insufficient owner-occupancy rates, pending litigation, incomplete construction, high investor concentration, or failure to meet Fannie Mae/Freddie Mac guidelines.
Are non-warrantable condo loans more expensive than conventional loans?
Non-warrantable condo loans have above market rates due to the specialized nature of the program. However, they provide access to unique properties.
How long does it take to get approved for a non-warrantable condo loan?
The approval process takes as few as 3 weeks. The process includes condo review, financial analysis, and specialized underwriting procedures for non-warrantable properties.
Can I use non-warrantable condo loans for investment properties?
Yes, non-warrantable condo loans are available for primary residences, second homes, and investment properties, though requirements may be stricter for investment properties. You may need higher credit scores and larger down payments.
What is the minimum down payment for non-warrantable condo loans?
The minimum down payment for non-warrantable condo loans is typically 25%, which is higher than conventional loans but helps offset the condo-specific risk. Higher down payments may result in better terms and lower costs.
Do non-warrantable condo loans require private mortgage insurance?
Private mortgage insurance (PMI) requirements vary by lender and down payment amount. With 25% down payment, PMI is typically not required, but with lower down payments, PMI may be required and will add to your monthly payment.
How do lenders evaluate non-warrantable condos?
Lenders evaluate non-warrantable condos by considering factors such as HOA financial health, occupancy rates, pending litigation, construction completion status, and the overall marketability of the property.
Can I refinance with a non-warrantable condo loan?
Yes, you can refinance with a non-warrantable condo loan if you meet the eligibility requirements. This can be a good option for condo owners who want to lower their interest rate, change loan terms, or access equity.
What if the condo becomes warrantable later?
If your condo becomes warrantable (meets Fannie Mae/Freddie Mac guidelines), you may be able to refinance into a conventional loan with better terms and lower costs.

Next Steps: Continue With Your Mortgage

Non-warrantable condo loans may provide a path to condo ownership for buyers turned down by traditional lenders. Our listed loan officers understand condo requirements and can help determine if this program might fit your situation. They'll review your condo's characteristics, assess your financial profile, and guide you through the process.

For a no obligation conversation about your mortgage, contact Coby Matush (#1531494) of Novus Home Mortgage at 724-787-7778.

Coby Matush Customer Reviews

Read verified customer reviews for Coby Matush at Novus Home Mortgage. This is real feedback from real borrowers who used Coby Matush and their colleagues for a mortgage loan.

4.8
★★★★★
(237 reviews)
★★★★★
August 2022

"Michelle helped us for several months before we chose a home during the preapproval process and she was extremely great and responsive. Then we worked with Kevin and he was also really responsive and easy to contact by email and by phone. I felt like he was available when I had a question and I appreciated being able to tie off a lot of things by email since I'm usually working at my PC. He also explained things in a way that made sense and kept us updated on every step of the process along with videos that explained it. I appreciate all the help in purchasing our first home."

- Camila Restivo

Similar Mortgage Programs to Non-Warrantable Condo Loans

If non-warrantable condo loans are not the right fit, these alternative programs might work better for your situation. Each has different requirements and lenders who specialize in helping borrowers with specific challenges get approved for mortgages.

Dan Green, Managing Editor at AnotherLender.com
Dan Green, Managing Editor
AnotherLender.com
Mortgage industry since 2003
AnotherLender.com Editorial Team
Reviewed for accuracy and completeness
This page was reviewed by the AnotherLender.com Editorial Team, which includes mortgage industry veterans and credentialed experts. Our editorial process ensures that all information is accurate, up-to-date, and helpful for home buyers and homeowners.
Last updated: July 20, 2025, 2:15 PM EDT

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Truth in Lending Act (TILA): Lenders must provide clear disclosure of loan terms, including interest rates and fees.
Real Estate Settlement Procedures Act (RESPA): Protects consumers from unfair practices in real estate transactions.
Fair Housing Act: Prohibits discrimination in housing-related transactions.

Disclaimer: This information is for educational purposes only. AnotherLender.com is not a lender and does not make loans. We connect borrowers with licensed mortgage professionals. All loan approvals are subject to lender underwriting guidelines and individual qualification. Rates and terms may vary. Consult with a qualified mortgage professional for personalized advice.