1-888-800-1042
Kaman Cusimano Logo

Condo | HOA Lawyers

Wall Street Journal Reports on Possible Changes to Condo Loans

In today’s Wall Street Journal, there is a report that two Congressmen are calling on Fannie Mae and Freddie Mac “to relax recently tightened standards for mortgages on new condominiums, saying they could threaten the viability of some developments and slow the housing market recovery.”

Freddie Mac and Fannie May will no longer guarantee mortgage loans to new certain new construction condominium projects, where greater than 15% of owners are delinquent, or where one owner owns more than 10% of units. These lawmakers hope to relax these new regulations. However, until that happens, there are a few things associations can do to ensure that potential buyers can still get a loan for their unit. First, boards should continue to implement and enforce a strong collections policy to keep delinquencies low. This was a main topic at the recent Financial Crisis seminar presented in April by Kaman & Cusimano, LLC. While keeping delinquencies low in a difficult market can often be challenging, the alternative could be catastrophic for the community. Second, boards often ask if they should consider reversing a no leasing amendment to the Condominium Declaration. Absent critical and unique circumstances, our answer continues to be no.

By doing these things, an association can successfully navigate through the Fannie Mae and Freddie Mac regulations so that potential owners may still get financing for their units.

The Wall Street Journal article is available online on a free basis for a limited time here:

http://online.wsj.com/article/SB124562533240635581.html

Categories

Three bars icon gold

Recent blog Posts

Three bars icon gold

Partners Dan Miske and Lydia Chartre presented at Wisconsin’s Chapter of CAI on reserves and lending

On May 23, 2024, Partners Dan Miske and Lydia Chartre presented a webinar for the ...
Read More →

Strengthening Community Associations: The Vital Role of a Comprehensive Assessment Recovery Policy and Procedure

Community associations are founded on principles of shared responsibility and collective maintenance. From maintaining common ...
Read More →

Partner Nick Meinert presented at OLCA’s Spring Conference

Partner Nicholas Meinert gave a presentation at the 2024 Ohio Lake Communities Association’s Spring Conference. ...
Read More →

Matt Markley admitted to practice in Ohio!

We are excited to announce that Matt Markley has been admitted to practice in the ...
Read More →