Fannie Mae announced that it is undertaking a comprehensive review of hundreds of condominium projects in the state of Florida in an effort to allow additional projects to become Fannie Mae-eligible through a new “Special Approval” designation.
A dedicated team of six Fannie Mae professionals based in Florida is conducting a thorough examination of condominium projects across the state that may not currently meet Fannie Mae’s standard eligibility criteria and assessing specific criteria more closely, including occupancy, homeownership association dues, financial stability of the project and property condition.
Projects deemed to be sufficiently stable following the closer examination are granted a Special Approval designation, meaning lenders can originate and deliver mortgage loans secured by units in these projects to Fannie Mae.
Fannie Mae has been granting exceptions to its condominium eligibility guidelines on a case-by-case basis when requested by lenders. The Special Approval designation streamlines the process for lenders and catalogues projects across the state that are Fannie Mae-eligible.
Projects deemed eligible will be listed on www.eFannieMae.com as project reviews are completed, and qualified borrowers wishing to purchase units in these projects will be eligible for financing.
“This new initiative is geared toward providing maximum support for Florida’s distressed condo market as we continue to provide liquidity to the housing market more broadly,” said Karen Pallotta, Executive Vice President, Single Family Mortgage Business.
“The state’s condo market has been particularly hard hit by the housing downturn and we’re working with the industry and our partners to do all we can to stabilize the market and help spur recovery.”
“NAR applauds Fannie Mae for taking this important step to make condo loans more readily available in Florida,” said Moe Veissi, National Association of Realtors® First Vice President and broker-owner of Veissi & Associates Inc. in Miami. “Our state is probably the hardest hit as far as the condo market is concerned, and Fannie Mae’s new effort to take a closer look at project eligibility could go a long way to putting projects back on a healthy financial track.”
Special Approval designations are effective for periods between 9 and 18 months, and lenders are required to confirm the project’s Special Approval designation on the date of the loan application.
The Special Approval initiative is for established condominium projects only.