Unwarrantable Condo down payment with lower down payment.

Asked by tetete, Appleton, WI Wed May 28, 2014

From what I am reading this is a bit of a longshot but I recently ran into an unwarrantable condo that I would be very interested in. The problem is I don't have the 20% down required or even the 10% I was able to find through a local lender. The condo is about $80,000 and I have $4000 for a down payment today. From what the agent said the condo is units sold away from being warrantable.

So anyone know of any banks offering a 5% down payment on an unwarrantable condo? My credit is in the 760 - 800 range using myfico.com's scorewatch. Steady job, sufficient income etc. Thanks.

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Steven D Are…, Agent, Green Bay, WI
Fri Feb 20, 2015
I think you would have a couple of options when wanting to purchase a non warrantable condominium unit. One option that I have used with my clients is that the seller could possibly hold 15% of the proceeds and the buyer would put his 5% down. This will give the buyer his 20% down to move forward with the loan and ultimately ownership of the condo unit. This is a portfolio loan using direct funds from the bank itself so more than likely the Bank will approve because the underwriter requirements are not as strict. Both parties are usually more than happy with this type of agreement. The payment on the second is minimal and the buyer can usually re- finance the second rather quickly. Recently a handful of banks have been offering first time home buyer options for non warrantable condos that do include a 5% down option with discounted closing costs. I know that Anchor Bank is using this first time home buyer product for non warrantable condos. Your credit score is great and as long as your debt ratios meet the underwriters approval and there are no other credit issues I think you can obtain a loan.
0 votes
I am confused... what you are describing is illegal isn't it?
Flag Wed Aug 24, 2016
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