RE: Multi Family Strawbale Housing
From: Daniel Nachbar (
Date: Thu, 24 Oct 1996 08:22:54 -0500
As a practical matter, convincing your banker is not sufficient.
Almost all mortgages are "resold" via the Federal National Mortgage Association
(abbrev - FNMA, stock ticker FNM, pronounced "Fannie Mae"). De facto,
FNMA sets the rules.  FNMA is the proverbial 800 pound gorilla for home loans.

Assuming you wish to do anything that is not "approved" by FNMA, your
financing options will severely limited.  As a result, the homes will be
much harder to sell because potential buyers can not go to just any bank for
a mortgage.  They will have to stick with those banks that 1) understand
what you are doing and 2) have room in their portfolio for your this
particular mortgage, and 3) haven't made more than a handful mortgages in your
community already -- banks need to stay diversified.

To make matters worse, construction lenders almost never lend money for a
project that isn't pre-approved by FNMA.  Potential construction lenders
want to see a clear path for having the homes sold at the end of
construction.  No FNMA, no clear path.

For our group, the issue was minimum size of homes.  We had several buyers
who were single people who wanted very small homes.  FNMA has a minumum
size (in square feet).  Insanely, we had to INCREASE the size of these
homes to make it possible for the buyers to get a mortgage.

Of course, you can always try to get FNMA to change its policies or
make an exception.  But, I've never heard of it happening.

You have a long way to go.  Pick your battles wisely.

Dan Nachbar
Pioneer Valley CoHousing
nachbar [at]

PS -- I've mentioned mortgages. Almost all of the same restrictions apply
to co-op share loans as well.

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