I’m Michael DiVita (DRE #01372066 | NMLS #241655), DiVita Home Finance (DRE #01818285 | NMLS #323700), Tiburon, CA. I’ve been in California mortgage lending since 2000 and founded DiVita Home Finance in 2007. When the bank says no, I find a way. Call (800) 239-1103. Buyers signing loan documents, November 2026.
The short answer: this La Jolla condo loan was about as clean as they come. $1,290,000 purchase, 20% down, full documentation, and a jumbo 7-year ARM with very competitive pricing. The only snag was the building. The management company filled out the condo questionnaire saying there was no SB 326 balcony inspection and that one wasn’t required. That didn’t sound right to me. The listing agent dug up an SB 326 report from 2024, the management company corrected the questionnaire, and the lender signed off. My takeaway: get ahead of what the lender might ask for, even if it turns out they don’t need it.
The Loan Was the Easy Part
My buyers were purchasing a condo in La Jolla for $1,290,000 with 20% down. Full documentation, easy loan.
They chose a jumbo 7-year ARM. The rate is fixed for the first seven years, then it can adjust. The pricing on this one was extremely competitive, and for a buyer who doesn’t expect to keep the same loan for 30 years, it made sense. If you’re weighing that choice, I walk through it in ARM vs. fixed-rate mortgages.
One detail people find surprising: at $1,032,000, this loan is actually under San Diego County’s 2026 conforming limit of $1,104,000. It didn’t have to be a jumbo. But some jumbo programs will take loan amounts in that range, and on this file the jumbo pricing was significantly better than a Fannie Mae loan. That’s why I shop the loan across lenders and programs instead of assuming the loan size picks the product.
So the buyer side was done quickly. On a condo, though, the lender has to approve the building too.
“No SB 326 Report. Not Required.”
The lender sends the HOA’s management company a condo questionnaire. It asks about the budget, reserves, insurance, litigation and, in California, the SB 326 inspection.
Quick background: SB 326 is the California law that requires condo HOAs to have a licensed engineer or architect inspect balconies, decks, stairways and walkways. The first inspection was due by January 1, 2025, then at least every nine years after that.
This management company answered that there was no SB 326 inspection and it wasn’t required.
That raised a flag for me. The law only covers elevated walking surfaces more than six feet off the ground that are supported in whole or in large part by wood. So a building can be exempt if those balconies and walkways are all steel or concrete. I started asking: are all of the elevated surfaces metal? Is there any wood framing holding anything up?
The lender had questions too. If the building needed an inspection and didn’t have one, that’s a problem. If it didn’t need one, somebody had to explain why.
Teamwork Makes the Dream Work
This is where the listing agent came through. He knew this building needed an SB 326 report, and he went and found it. There was one, done in 2024. He got a copy and sent it over.
Once the report was in hand, the management company quickly corrected the questionnaire. Luckily the budget was solid and everything else checked out, so the lender signed off.
On my Palm Springs condo deal, I was the one chasing the HOA for documents. This time the listing agent didn’t just forward the problem. He fixed it.
Covering All Bases
When the SB 326 report showed up, I also asked for proof that any repairs in it had been completed: invoices, a contractor’s letter, anything. On my Palm Springs condo deal last month, that exact request held up the whole file.
On this one, that proof never came back. In the end the lender didn’t need it. But I’d rather ask early and not need it than have the lender ask at the last minute and stall the closing.
The Takeaway
Get ahead of the items a lender might ask for, even if you don’t think they’ll need them. Management companies make mistakes. Questionnaires get filled out wrong. If you wait for the lender to find the problem, you lose days you may not have in escrow.
What I Tell Condo Buyers
- Read the condo questionnaire, don’t just forward it. If an answer looks off, like “no SB 326 required” on a building with wood-framed balconies, question it right away.
- Ask for the SB 326 report with the HOA documents, along with the budget, reserve study, master insurance and recent board minutes.
- If the report lists repairs, ask for proof they’re done before the lender does.
- Lean on the listing agent. A good one knows the building and can get documents the management company can’t find.
- Don’t remove your loan contingency until the HOA is signed off, even when the loan itself is done.
- Watch the reserves. Starting January 4, 2027, Fannie Mae raises the reserve requirement on full condo reviews from 10% to 15% of the HOA’s annual assessment income. Jumbo lenders set their own rules, but many look at the same things.
About this case study: this is my own file; my buyers are signing their loan documents in November 2026. Details are from the actual transaction; the buyers, building and agents aren’t named for privacy. Lender and HOA requirements vary, so treat this as an example, not a guarantee.
Frequently Asked Questions
Does SB 326 apply to every California condo building?
No. California Civil Code 5551 applies to condo HOAs in buildings with three or more attached units, and only to balconies, decks, stairways and walkways more than six feet above ground that are supported in whole or in substantial part by wood. Elevated elements that are all steel or concrete aren’t covered.
What if the HOA questionnaire says no SB 326 inspection was done?
Ask why. Either the building is exempt, which someone should be able to explain, or the inspection was done and the management company missed it, or the HOA is out of compliance. In my La Jolla deal, a 2024 report existed and the questionnaire was simply wrong.
Can I use a jumbo loan to buy a condo?
Yes. Jumbo lenders still review the condo building, usually with their own questionnaire and HOA document requirements, which can be similar to Fannie Mae and Freddie Mac’s.
What is a 7-year ARM?
An adjustable-rate mortgage with a fixed rate for the first seven years. After that, the rate can adjust based on an index plus a margin, within set caps. It can make sense if you expect to sell or refinance within that time.
Why ask for proof of SB 326 repairs if the lender didn’t request it?
Because if the lender asks late in escrow, it can delay closing while you chase invoices or contractor letters. Asking early costs nothing, and sometimes, like on my Palm Springs file, it’s the item that holds everything up.
Related Resources
- Palm Springs Condo: The Buyer Was Approved, the Building Wasn’t (Yet)
- SB 326 and California Condo Mortgages
- Fannie Mae’s August 2026 Condo Rule Change
- Jumbo Loans in California
- ARM vs. Fixed-Rate Mortgage in California
- Non-Warrantable Condo Mortgages in California
Official Sources & References
Talk to Michael Directly
DiVita Home Finance | Tiburon, CA | In lending since 2000, founded DiVita Home Finance in 2007. Michael DiVita DRE #01372066 | NMLS #241655. Company DRE #01818285 | NMLS #323700.
💬 Text: (310) 849-9124
