Condo Mortgages: Why Lenders Scrutinize the HOA, Not Just You
Financing a condo involves an extra layer of underwriting that doesn't apply to single-family homes: the lender evaluates not just the borrower, but the condominium project itself — its finances, insurance, and how it's managed. A borrower with excellent credit can still run into financing trouble if the specific condo building doesn't meet a lender's requirements. Why the building itself gets underwritten Because a condo owner shares financial responsibility for the building through HOA dues and special assessments, and because the building's overall condition and management affect every unit's value, lenders evaluate the condo project as a whole, not just the individual unit being purchased. This is meant to protect against financing a unit in a building with serious financial or structural problems that could affect the loan's collateral value. The condo questionnaire Lenders typically require a completed condo questionnaire from the HOA or proper...