Conventional Condo Mortgages

Conventional Condo Mortgages - Kitchen ImageBy conventional condo mortgages, I mean the conforming kind, the kind that Fannie Mae and Freddie Mac would buy, the ones with the better rates.

These two agencies have a lot of eligibility rules, some of which change every now and again.

One thing people forget, a condominium is a form of ownership.  It is possible to own detached single-family houses as condos.  It is possible to do it with townhouses.  But not all townhouses are under condo ownership.

Aside from the eligibility rules, there’s another thing, a bit unfair, that’s particular to condo mortgages.

The homeowner association fees are always included into the housing expenses.

Some association have high fees, but all utilities are included.  Other association have lower fees, but no utilities are included.

What’s unfair is that in either association people pay all utilities.  But those cost of utilities reduces the loan amount available only if it’s included in the association fee. (Presumably because if you don’t pay your fees, the association can take action against you, going as far as foreclosing on you while the utility companies cannot force you into foreclosure.)