What makes a condo non-warrantable, and can it still be financed?
A condo is non-warrantable when its association has issues like pending litigation, deferred maintenance, low owner-occupancy, or insufficient insurance — which makes it ineligible for conventional or FHA financing. It can still be financed through a non-QM lender. As a broker with 90+ lenders, I specialize in these and other deals that fall apart elsewhere.
Key takeaways
We're seeing more non-warrantable condos these days as condo insurance costs rise and associations run into deferred maintenance or litigation. When a condo is non-warrantable, you can't finance it with conventional or FHA — you need a lender who does non-QM. That's exactly the kind of deal I solve, and I've closed several this year that fell apart with other lenders.
The deals other lenders give up on
My reputation is built partly on solving the loans nobody else can — what we call "911 deals," where a buyer was working with another lender and the deal fell apart at the last minute. Non-warrantable condos are a classic example, and they're more common every year.
What is a non-warrantable condo?
A condo is warrantable when it meets Fannie Mae, Freddie Mac, FHA, and VA guidelines — which is what lets a normal mortgage finance it. It becomes non-warrantable, and ineligible for those loans, when the association trips one of their rules.
| Warrantable condo | Non-warrantable condo | |
|---|---|---|
| Meets Fannie/Freddie/FHA rules | Yes | No |
| Financed with conventional/FHA/VA | Yes | No |
| Financing path | Standard mortgage | Non-QM / portfolio loan |
| Typical down payment | As low as 3–5% | Often 10–25% |
Why condos go non-warrantable
We're seeing this more and more when:
- Too many units are investor-owned (not enough owner-occupants)
- The association is in litigation
- One person or entity owns too large a share of the units
- Reserves are inadequate or there's deferred maintenance the budget hasn't funded
- Rising condo insurance costs have left the association underinsured
Important: it's the lender's underwriter, applying those agency rules during the condo review, who determines warrantability — not the seller or the listing agent.
It can still be financed
The good news: a non-warrantable condo can still be financed through a non-QM or portfolio lender — you just need someone with those relationships. These programs use flexible underwriting, often go up to large loan amounts, and offer 30-year fixed (and interest-only) options. Plan on a larger down payment than a standard conventional condo, frequently in the 10%–25% range depending on the building and your profile.
A note on resale
Buyers sometimes worry a non-warrantable condo is hard to resell. It can take a more motivated buyer, or one using a portfolio loan like yours — but many buildings fix the underlying issue over time (litigation settles, reserves rebuild) and become warrantable again. I'll give you an honest read before you buy.
And other tough scenarios
With access to more than 90 lenders, I also finance properties most banks won't, including mobile homes in resident-owned communities (co-op parks) and manufactured homes built before June 1976, which conventional lenders generally won't touch. Frankly, if I can't find a solution, it's usually a loan that can't be done right now — and I'll tell you that honestly, then help you build a path forward.
Frequently asked questions
What makes a condo non-warrantable, and who decides?
A condo is non-warrantable when its association fails Fannie Mae, Freddie Mac, FHA, or VA guidelines — usually because of too many investor-owned units, pending litigation, one owner holding too many units, weak reserves, or inadequate insurance. It's the lender's underwriter, applying those agency rules during the condo review, who determines warrantability — not the seller or the listing agent.
Can I get a mortgage on a non-warrantable condo in New Hampshire?
Yes, through a non-QM or portfolio lender. Conventional, FHA, and VA won't finance a non-warrantable condo, but as a broker I have lenders who will. I've closed several of these this year, including deals that fell apart with another lender first.
Can FHA finance a non-warrantable condo?
No. FHA requires the condo project to be on its approved list or meet its guidelines, so by definition it won't finance a non-warrantable building. The path is a non-QM or portfolio loan instead — which is exactly the kind of financing I source for these properties.
What down payment do I need for a non-warrantable condo?
More than a standard conventional condo — typically somewhere in the 10% to 25% range, depending on the building's issues, the loan amount, and your credit and reserves. I'll match you to the portfolio lender with the most favorable terms for the specific project you're buying in.
Is it hard to sell a non-warrantable condo later?
It can take a more motivated buyer or one using a portfolio loan, since conventional and FHA buyers are off the table until the building becomes warrantable again. But many associations fix the underlying problem over time — litigation settles, reserves rebuild — and the unit regains full financeability. I'll give you an honest read on the building before you commit.
Can you finance a mobile or manufactured home?
Often, yes. I have lenders who finance mobile homes in resident-owned co-op communities and even manufactured homes built before June 1976 — both of which most conventional lenders reject. New Hampshire Housing also finances resident-owned communities.