When getting a loan for a condo the lender will want to know if the condo complex is warrantable or non warrantable? This is not a question that you will generally have to deal with if you are purchasing a single family home.
There are several factors lenders will look at when determining if a condo complex is warrantable. Your lender can discuss these factors in greater detail.
The main factor that will make a condo non warrantable in the UT campus area is the number of investor owners versus the number of owner occupants at a particular condo complex. If 51% or more of the units at a complex are investor owned, the complex is non warrantable.
For potential buyers that are relying on a big national bank to get their loan, they may get discouraged and decide that they can not buy a condo near campus. In general these national banks will not do a loan for a non warrantable property. In addition, if these banks are not told up front, they generally do not realize that the condo is non warrantable until you are more than halfway toward your closing date…now what!
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