How to Finance Non-Warrantable Condos, Resort Condotels & HOA Litigation Buildings with DSCR Loans
Fannie Mae and Freddie Mac maintain a strict Condo Project Manager (CPM) blacklist that rejects buildings with short-term rental desks, >50% investor concentration, or <10% budget reserves. Non-QM DSCR condotel shelves underwrite the individual unit cash flow using a limited HOA questionnaire.
1. Bypassing Full Fannie Mae Form 1076 Project Review via Limited Non-QM Questionnaire
On non-warrantable condos where 60%–90% of units are investor-owned rentals, Non-QM DSCR lenders waive investor-concentration caps entirely and only verify that no single entity owns >20%–25% of the building and that structural/safety inspections are current.
2. Financing Resort Condotels with On-Site Registration Desks & Daily Housekeeping
As long as the unit has a full kitchen (full-size refrigerator, stove/cooktop, and sink), minimum 400–500 sq ft of livable area, and individual fee-simple deeded title, dedicated Condotel DSCR shelves lend up to 75% LTV on purchases and 65%–70% LTV on cash-out.