Cohousing-L Mailing List: Re: co-housing unacceptable to Fannie Mae?!?

[Diana Carroll (dianaecarroll]

Ug!  yes, we ran into this.  We were never able to get a straight answer to
your question.

For a long time, we weren't approved for Fannie Mae mortgages because we
didn't have the right % of units sold.  Then, once we did, we ran into a
couple lenders who told us that Fannie Mae had recently issued a statement
*specifically against cohousing*, by name -- that being a cohousing
community meant you didn't meet Fannie Mae guidelines.

This was of great concern so we tried to contact fannie Mae directly to ask
what was what, but we weren't able to get to talk to anyone official...they
only want to interact with banks, and they are really closed-lipped in
public about what does and doesn't qualify for their guidelines.

We eventually found a lender who said, no, Fannie Mae was fine with
cohousing (or, rather, didn't care about cohousing), and that the other
banks were just saying that.

So...what?!?

We never got to the bottom of that, but did learn that banks often
misrepresent or perhaps even misunderstand fannie mae guidelines.

If you ever get to the bottom of this mystery I'd love to hear about it.

- Diana, Mosaic Commons in Berlin, MA

PS: One of the reasons we don't have a "right of first refusal" clause in
our CCRs is specifically because we were forewarned that it made mortgages
hard to get.


On Tue, Apr 24, 2012 at 1:56 PM, Lyle Scheer <wonko [at] monkeyhouse.org> wrote:

>
> Hi all,
>
>    I'm going through a mortgage process, and hit an underwriter who is
> telling me, "the project is unacceptable to Fannie for two reasons right
> off the bat.  One, the project is a Co-Housing Community and second [has
> a right of first refusal clause]"
>
>    The second one I've heard others on this list have trouble with, and
> I'm working to clarify that it's only a 30 day right of first refusal
> and then reverts to sale to any 3rd party... see if that flies.... work
> with my community to amend our CC&Rs quickly if not.... I also thought
> we had language that let banks off that particular hook, but can't find
> it at the moment.
>
>    However, it's the first bit that truly startles me.  Does Fannie Mae
> really find co-housing in general unacceptable?  Has anyone ever gotten
> that back from an underwriter?  Really?
>
>    I'm fighting back on that one by trying to state very clearly that
> we're incorporated as an HOA, and that we follow HOA rules... all our
> legal documents talk about a board of directors and votes for exactly
> this reason.  (NO... we're not co-housing, we're an HOA)
>
>    However, I'm curious to anyone within the past couple of years where
> the underwriters are getting very picky because of the financial state
> of loans, has anyone run into the "can't Fannie Mae because you're
> co-housing" and successfully argued back and how you did it.  Just
> looking for more ammo in my particular somewhat urgent situation.  I
> just find it hard to believe Fannie Mae universally is blocking
> co-housing... if that were truly the case this would then be a call to
> arms email of what we can do nationally to fix co-housing's general
> image with Fannie mae.  Personally I just think it's a worried
> underwriter, but that's also an issue.
>
> - Lyle
> _________________________________________________________________
> Cohousing-L mailing list -- Unsubscribe, archives and other info at:
> http://www.cohousing.org/cohousing-L/
>
>
>