---
title: Condo Association Loan - Terms and conditions
description: Condo association loan terms need to be compared against alternatives such as self-funding
---

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# [Condo Association Loan - Terms and conditions](https://www.condoassociation.com/blog/tabid/19257/bid/71939/Condo-Association-Loan-Terms-and-conditions.aspx)

 Written by [Phil Lamb](https://www.condoassociation.com/blog/author/phil-lamb) | Thu, Nov 10, 2011 @ 02:12 AM

Board members seeking a condo association loan need to understand the available terms and conditions for these loans. Assuming that a condo association meets the relevant [underwriting criteria](https://www.condoassociation.com/blog/tabid/19257/bid/71727/Condo-association-loans-Understanding-underwriting-criteria.aspx), the terms of the condo association loan need to be compared with self-funding and other options.

Provided that the condo association qualifies, typical terms and conditions include:

* **Amount:** Up to 100% of project costs

* **Term/Amortization:** Ranging from 5 years to 15 years to match the useful life of the capital improvement

* **Rate:** Based on Treasury Rate or other index (typically 5.00% to 6.00% rate)

* **Closing costs:** Minimum of $2,000 (including attorney fees); typically 1.25% of loan amount

As an example, assume that a condo association has 200 units and has a $500,000 capital improvement project (e.g., roof repairs, siding, common areas, etc...). Their choices would be to a) obtain a $500,000 condo association loan, b) levy a $500,000 special assessment, or c) forego the capital improvements.

Assuming that the $500,000 loan was made at 6.00% over 10 years, the monthly payment would be $4,750 or $237.50 per unit. The special assessment alternative would amount to $25,000 per unit. 

 

 

[View full post](https://www.condoassociation.com/blog/tabid/19257/bid/71939/Condo-Association-Loan-Terms-and-conditions.aspx)

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