Condominiums are becoming more difficult to purchase and refinance as
lenders increase
condo fees and tighten
condo regulations to offset what they say
is the higher risk of lending to buyers of condos as compared with
buyers of single-family homes.
The changes are part of an effort by mortgage giants Fannie Mae and Freddie Mac to limit risky lending in a segment of the housing market particularly hard hit by foreclosures in recent years.
In
addition to paying higher condo fees, prospective buyers now
must make down payments of up to 20 percent because companies that
traditionally insure lenders against borrowers who default are shying
away dealing with condo associations.
Condos are considered more problematic to lenders because a
few foreclosures can affect property values for an entire complex.
Also, he said, they carry monthly condo fees and special HOA assessments that can
create massive collective debts if individual unit owners fall behind
on payments. It's
particularly unfair to first-time buyers, who often opt for condos, she
said.
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