Monday, May 9, 2011 - Article by: Tom Stevens - Flagstar Bank -
Condotel financing is BACK!
Here's a good sign of things turning around: I now have a program designed to help fill the needs of customers with condo-hotel projects in the following areas: Colorado (Aspen and Vail), Utah (Summit), Hawaii and US Virgin Islands.
Some features of the new program are:
o Second Home and Investment Property, purchase and rate/term refinance transactions.
o Up to 65% loan-to-value.
o Minimum credit score of 720.
o Loan amounts up to $650,000.
o 3/1, 5/1 and 7/1 LIBOR ARM available.
o Project must be approved by my Condominium Review Department and meet the following criteria:
o Established projects - Project must be 100% sold and the HOA turned over for 12 months.
o Established management company - only projects that contract with managing agents with a successful track record of managing condo-hotel properties will be considered. Submit marketing package for the management company.
o Minimum 20 units in project.
o Minimum unit size of 1000 square feet; smaller units may exist within the development, but will not be eligible for Flagstar Bank financing.
o Flagstar Bank project participation limited to no more than 20% of the units.
o Eligible projects may not include any timeshare units or other fractional share ownership structures.
o No one entity may own more than 10% of the project.
o Commercial space limited to no more than 20% of the project; all commercial space must be leased.
While this initial phase of the program misses some popular condotel areas, it's a good start.
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