Can I get a DSCR loan on a non-warrantable condo?
Yes. Multiple non-QM DSCR lenders explicitly allow non-warrantable condos at up to 75% LTV with no concentration / litigation restrictions.
Non-warrantable condos - condos that fail Fannie Mae / Freddie Mac warrantability tests (too much investor ownership, ongoing litigation, single-entity ownership above thresholds, hotel-condo mix, etc.) - are routinely rejected by conventional lenders but accepted by several DSCR programs. The typical non-warrantable DSCR scenario: investment property, building has >50% investor ownership, or HOA has open litigation. Max LTV is usually 75% (5-10% lower than warrantable), with FICO floors at 660-680 and full DSCR programs available. Condotel (operates partly as a hotel with rental program) is a separate, narrower category: a handful of specialty lenders cover condotel DSCR at 70% LTV. Non-warrantable cash-out refi is also available with most lenders at 70% LTV. Underwriting documents: the lender pulls the HOA budget, master insurance certificate, and condo questionnaire to assess concentration and reserves regardless of warrantability. Florida and Hawaii have the highest concentration of non-warrantable inventory; both are well-covered by specialty DSCR lenders.
People also ask
What makes a condo non-warrantable?
Common causes: >50% investor ownership, single entity owns >10% of units, HOA in active litigation, <10% of HOA budget in reserves, hotel-condo mix, or commercial space >35% of total square footage.
Are condotels eligible for DSCR loans?
Yes on specialty programs. Condotel DSCR financing is offered by a handful of non-QM lenders at 70% LTV with FICO 700+ and stronger reserve requirements.
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