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If you’re only being asked for 10% coverage, you’re better off than many. The standard H0-6 coverage amount is 20%. This coverage is also exceptionally inexpensive. Not sure how much you’d save by purchasing improvements and betterments (IF lender would allow it), but doubt it would be significant compared to 10% H0-6 policy.
9 months ago
Cheri Crandall
said:
Lender asked for a budget letter from the manager of the condos I am trying to purchase a unit in. Their budget only allowed for 4.9% of the required 10% FNHMA says they have to have in reserves. Is there any other way to document the remainder? How have they sold hundreds of these condos over the years and this never been an issue?
9 months ago
Ted Rood
said:
@Cheri Crandall Hi Cheri: Can’t say if condo complex budget has changed, but can say that condos in general have the highest default rates, and lenders, Fannie, Freddie, and FHA all have greatly increased their scrutiny and documentation for condo loans over the past few years.
My HOA master policy has “walls in” coverage. How much coverage I need to provide for “improvements and betterments”? My bank requested 10% of the appraised value. Is it possible to buy just “improvements and betterments” policy?
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