Non-Warrantable Condo Mortgage California
Non-warrantable condos are one of the most common financing roadblocks in California’s real estate market. When a condo doesn’t meet Fannie Mae or Freddie Mac eligibility requirements, conventional lenders say no — and many non-QM lenders do too. DiVita Home Finance works directly with portfolio investors who specialize in non-warrantable condo financing throughout California.
What Makes a Condo Non-Warrantable?
A condo becomes non-warrantable when it fails to meet agency guidelines. The most common reasons in California include:
- High investor concentration: More than 35–50% of units owned by investors (not owner-occupants)
- SB 326 non-compliance: HOA hasn’t completed required balcony/exterior inspections under California SB 326
- Commercial space over 35%: Building has too much retail/commercial relative to residential
- HOA litigation: Association is involved in active litigation
- Condo-hotel / condotel: Units rented through hotel programs or short-term rental pools — see our condotel mortgage guide
- Insufficient HOA reserves: HOA has less than 10% of budget in reserves
- Single entity ownership: One person/entity owns more than 10–20% of units
Non-Warrantable Condo Loan Options
| Loan Type | Available for Non-Warrantable? | Notes |
|---|---|---|
| Conventional (Fannie/Freddie) | No | Requires warrantable condo status |
| FHA / VA | No (usually) | Requires FHA/VA condo approval |
| Portfolio Lender | Yes | Best option — lender holds loan in-house |
| Non-QM / Bank Statement | Yes | Available but watch for higher rates |
| Hard Money / Bridge | Yes | Short-term solution while warrantability is resolved |
California Markets Where Non-Warrantable Condos Are Common
Non-warrantable condos are especially prevalent in San Francisco, Los Angeles, Palm Springs, and coastal beach communities where investor concentration, short-term rentals, and older HOAs with deferred maintenance are common. If you’re buying in these markets, confirming warrantability before you write an offer is essential.
In-Depth Articles
- Non-Warrantable Condo California: All the Reasons Lenders Say No
- SB 326 Condo Financing: Why Even Non-Warrantable Lenders Say No
- SB 721 Apartment Balcony Inspections and Mortgage Delays
- Condo Hotel (Condotel) Mortgage Financing in California
Frequently Asked Questions
Can I get a mortgage on a non-warrantable condo in California?
Yes. You won’t be able to use a conventional Fannie Mae or FHA loan, but portfolio lenders and non-QM lenders can finance non-warrantable condos. Rates are typically 0.5–1.5% higher than conventional. DiVita Home Finance has direct relationships with investors who specialize in these loans.
How do I find out if a condo is warrantable?
Your lender will order a condo project questionnaire from the HOA. This document reveals investor concentration, litigation, reserves, and other factors that determine warrantability. Get this ordered early — before you remove contingencies.
What’s the down payment on a non-warrantable condo?
Most portfolio lenders require 10–20% down on non-warrantable condos. Some non-QM programs allow 10% down. You won’t find 3–5% down options for non-warrantable condos.
About DiVita Home Finance
DiVita Home Finance is a small, family-owned mortgage company based in Marin County, California. When you call, you speak directly with Michael DiVita — the owner — not a call center, not an out-of-state rep, not someone reading from a script. We’re here for a low-key, no-obligation conversation about your situation.
We take your privacy seriously. We will never sell your information to third-party lenders or lead generation companies — unlike many of the large mortgage platforms. Your inquiry stays with us, period.
📞 Call: (800) 239-1103 | 💬 Text Michael directly: (310) 849-9124
