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Fannie Asks Mortgage Execs How to Improve Condo Lending
Wednesday, October 21, 2020
The most recent Fannie Mae's Lender Sentiment Survey
focuses on the complexities of lending to the condominium market. The company
stresses that this type of housing can play an important role in narrowing the supply gap for
affordable housing options as well as providing an attractive alternative for
homeowners seeking to downsize. However, since the great recession, there has
been a significant shortage of both new and existing units for sale. Condos
represent 8 to10 percent of the mortgage market but tend to exist primarily and
thus play a larger role in many urban areas. They also present unique risks
given the financial responsibility owners share for the operation and maintenance
of the common areas and shared amenities. Lenders may also face increased time
and costs due to the complexity of underwriting condo project eligibility.
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