Fannie Mae Announces Help for Distressed Florida Condo Market

After a year of struggling mightily to find mortgage financing options, buyers of Florida condominiums could see loans become easier to obtain under a program announced last Thursday by Fannie Mae. According to executive vice president Karen Pallotta, "The new program is meant to help Florida's distressed condo market as Fannie Mae continues to provide liquidity to the broader housing market in general.

Fannie plans to comprehensively review hundreds of condominium projects statewide that may not meet its current eligibility criteria for financing because of occupancy problems or high delinquency rates on homeowner association dues. The review will look at a the individual condo project's occupancy level, association dues, financial stability and property condition. If it is deemed sufficiently stable following this closer examination, the project will be granted a new "Special Approval" designation, thereby freeing lenders to originate and deliver mortgage loans secured by Fannie Mae. Projects deemed appropriate will be listed on www.eFannieMae.com, and qualified borrowers will be eligible for financing through the lender of their choice.

The Special Approval designation program will be effective for a period between 9 and 18 months, and lenders must confirm the condo project's current designation on the date of the loan application. In addition, the Special Approval program applies only to established condominium projects.

This is fabulous news for buyers and sellers alike and should help elevate the current glut of condominiums sitting stagnate on many markets in Florida. While there has not been much to be happy about within the lending industry during the last year, this is one move we can certainly applaud.