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General Info About HOA Loans or Condo Association Loans

Posted on Mon, Feb 02, 2009 @ 03:49 PM
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Our condo association's dam is in need of repair and our condo board would like to get a condo association loan or HOA Loan for doing the repairs.  What is a likely rate for a condo association loan? 

The exact interest rates are a function of several variables.  However, the approximate range in today's market is about 6%.  For a current condo association loan rate quote you can submit the HOA Loan Request Form.  HOA Loans and Condo Association Loans are a good alternative to special assessments that may drain condo association members.

We are a Co-Op.  Do we qualify for a Condo Association Loan?

Yes, Condo Association Loans and HOA Loans are for all types of Community Associations including: Condominiums, Homeowner Association's, Town-homes, Cooperatives, Timeshares.

Are there any restriction to what we can use HOA loans or Condo Association loans for?

Community lenders usually work with condo associations to provide innovative HOA loan and Condo Association Loan structures to just about any application.  Typical reasons for HOA loans and Condo Association Loans are to support capital maintenance projects, construction defect litigation, condo association insurance premium financing, purchasing real estate or equipment, condo association land lease buyouts.  

Other solutions include Condo Association Credit Line which HOA's can tap at their discretion to increase their cash flow.

What's the difference between a HOA Loan or Condo Association Loan and a HOA Line of Credit?

When a Condo Association takes out an HOA loan, the lender provides the condo association all the funds in one lump sum.  With an HOA credit line, a Condo Association qualifies for an HOA credit limit, which they can draw down on and pay back at any time. 

Top 5 Reasons for an HOA Loan or Condo Association Loan 

1. A Condo Association Loan Can Increase Condo Association cash flow

2. Condo Associations can make capital improvements or repairs with a condo association loan or HOA loan

3. An HOA or Condo Assocation can purchase additional property with Condo Association Loans and HOA Loans.

4. Condo Association Loans can be used to purchase condo units from condo unit owners or condo developers.

5. A Condo Association Loan or HOA loan can fund a construction defect litigation


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Comments

Thank you. This article gave me the information I,ve never get from my HOA boarding in 10 (ten) years. 
 
Posted @ Saturday, September 06, 2008 4:56 PM by Joao Rita
Hello, 
 
We have a small Condo Association of 3 units. We need a new roof and our estimate is 8K. There is only about $900 in the accout. None of us individually can come up with the money. How can we go about getting the funds? 
 
Thanks. 
 
Posted @ Tuesday, October 07, 2008 7:47 PM by Chelsea
Chelsea, although fixing the roof of your condo building is a good reason for an association loan, your condo association's number of units doesn't meet the minimum requirement for loans to a condo associations. Community lenders will not look at providing a loan to condo associations with less than 15-20 units in the building or as part of the HOA.  
 
 
 
I'd recommend seeing if you and your neighbors can personally qualify for an Home Equity Line of Credit (HELOC).
Posted @ Wednesday, October 08, 2008 10:01 AM by Roger
Our condo board is out of control with expensive projects. Now the board want to get a bank loan. Is there anyway at bank level to kill this loan. Texas
Posted @ Thursday, October 30, 2008 7:46 AM by texas
If other condo association members feel the same way about a condo association loan, you and the other members may have better luck trying to remove board members.  
 
 
 
HOA and condo association loans are very specific in what they can be used for. If your association is creditworthy and the loan is for a capital improvement, your condo association may get the bank loan.
Posted @ Thursday, October 30, 2008 9:50 AM by roger
What is the individual owner's liability? Also, is the HOA able to deduct the interest payments when filing as a non-profit even if the individual owner cannot? 
 
 
 
Thanks,
Posted @ Thursday, December 18, 2008 6:06 PM by Carolin
Condo Association loans are secured by the HOA lender's right to assess the association's unit owners and would fall under whatever assessment right's the association in entitled to. Each state can be different. Make sure you check with a lawyer, as to the personal liabilities in your state.
Posted @ Thursday, December 25, 2008 9:14 AM by Roger
Another option for smaller condo associations is to use home equity loans or lines of credit. Sometimes this is the only option for small condo associations.
Posted @ Tuesday, February 03, 2009 12:05 PM by Jake Henderson
How are HOA loans typically secured? We have 336 units and roof replacements are going to approach 2.5 Million dollars. Is it possible to get a loan for that amount?
Posted @ Monday, June 15, 2009 5:03 PM by Pete
Pete, loans are secured by the assigning the right to assess owners to the lender incase of default. Yes, just fill out the conact form and our HOA lending partners with contact you with 1-2 business days.
Posted @ Monday, June 15, 2009 5:08 PM by CondoAssociation.com
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