South Florida Condo Loans: Milestone Inspections, Reserves And What Lenders Review
Condos dominate South Florida, and lenders review the building as closely as the buyer. Here is what gets checked and how to avoid surprises before you offer.
The Building Is Part Of The Approval
In Broward, Miami-Dade and Palm Beach, many buyers purchase condos, and many buildings are older. Lenders review the association’s finances, reserves, insurance, legal issues and how many owners are behind on dues in addition to your own file.
Florida law now requires milestone inspections and structural integrity reserve studies for many condo buildings of three stories or more. Lenders pay attention to those results and to any special assessments that come from them.
Reading the association documents before you offer can save you time and money. A building that cannot qualify for financing can also be harder to resell.
Common Condo Review Points
Association finances
Budget, reserve funding, special assessments and delinquent owners.
Building condition
Inspection and reserve study status, plus any planned or required repairs.
Insurance
Master policy coverage and flood exposure, plus your own unit policy.
How To Reduce Condo Surprises
- Ask for the condo questionnaire, budget and recent meeting minutes early.
- Look for notes about assessments, deferred repairs or litigation.
- Get insurance quotes for the unit and check the flood zone. See our guide to home and flood insurance.
- Confirm the building meets the requirements of your loan type, including FHA if you are considering it. See our FHA loan limits guide.
Questions To Ask Your Lender
- Have you financed in this building before?
- What does the building review involve, and how long does it take?
- Could a special assessment affect my approval?
- What happens if the building does not qualify?
South Florida Condo Questions
Why is financing a condo harder than a house?
The lender reviews the association and building as well as you. Documents, reserves and insurance all have to meet the lender’s guidelines.
What are milestone inspections?
Florida requires structural inspections for many older condo buildings of three stories or more. Results can lead to repairs and assessments that lenders consider.
Can I buy a condo as a second home or rental?
Often yes, but financing for second homes and rentals can differ from a primary home. Tell your lender your plan early.
Looking At A South Florida Condo?
Talk with William Willis about what lenders review and what to line up first.
This page is general information, not legal, tax or insurance advice, a loan offer or a commitment to lend. Rules and programs change, so confirm details with the relevant agency, professional and lender. Loans are subject to credit approval and property eligibility. Mortgage services are provided by William Willis, NMLS #1514031. Verify licensing at the NMLS Consumer Access portal.