Case Study: Persistence Pays off When Navigating Loans and Condo Association Rentals
by Sara Ifert
on Thursday, October 31st, 2019 at 3:20pm.
Jennifer and Jordan Hegerfeld worked with Maureen Moran as they were getting ready to buy their first home. The couple found themselves with an accepted offer on their ideal condo, but there were hitches with securing the mortgage. Read on for the story of how Maureen’s persistence helped these first-time homeowners successfully purchase their new home.
Ready to become homeowners
Jennifer and Jordan began searching for their first home in March of 2019. They were ready to have a place of their own with more space, in a great school district for their child. At first, they considered single family homes, but most of the properties in their price range were fixer uppers and not in move-in condition. They found themselves looking for condos, which were easier to find within their budget. Jennifer and Jordan discovered a cute condo in Waunakee that was below their budget, but it didn’t have a basement, second bathroom or garage. Still, they really liked the place and decided they wanted to move forward with an offer, so Jordan called the condo management company for advice. They gave Jordan the contact information for Mad City Dream Homes, and that’s when Jennifer and Jordan were matched up with Maureen Moran.
Maureen worked with the couple to put an offer on the condo, however there was a snag when they discovered that the original developer had delayed maintenance items, and there were more rental units than most lenders want to see. They were able to cancel the offer and went back to the drawing board. Maureen listened to the Hegerfeld’s frustrations. She threw out ideas for them to consider. She kept rallying Jennifer and Jordan with pep talks and affirmations when their options seemed non-existent.
Jennifer and Jordan were really hoping for a two or three bedroom condo with at least one and a half baths. One day, Maureen found a delayed listing on the MLS that she knew would be right up the couple’s alley. It was a two bedroom condo in their target area with two full baths, plus had a garage and a full basement. The only catch was that the asking price was slightly higher than the Hegerfeld’s budget. They were soon able to see the condo, which was bigger than they thought, and fell in love with it. Maureen helped them write up an offer, and after some back and forth with the great listing agent, Jennifer and Jordan had an accepted offer.
Rentals Here, Rentals There, Rentals Everywhere!
With the accepted offer in place, it was now time to get the mortgage approval process going. Unfortunately, it turned out that there were a few too many rentals in this association too. After contacting four banks and credit unions, there seemed to be a consensus that the rental percentage was too high, and combined with the Hegerfeld’s modest down payment, no one appeared to be willing to move forward with the loan. Not willing to let the process stop there, Maureen reached back out to the original lender, who had been quiet about lending in this complex. With some cordial cajoling from Maureen, the lender stepped up to the plate and arranged for his firm to grant the Hegerfeld’s exception - the loan was funded! The couple was able to move into their home in June of 2019.
What’s the Problem with Condo Rentals and Mortgages?
Condo associations often have limits as to how many units can be rentals instead of being owner occupied. At price points below $150,000, buyers and their agents have to do some extensive homework to discover if the condo is "warrantable". In other words, the bank needs to know more about the complex, especially what percentage of the units are rented in relationship to how many are owned. If the complex has a greater amount of rentals than typically preferred (generally, more than 20%), only certain lenders will write a loan in that development.
In a situation like this, persistence pays off. Maureen wasn’t willing to give up even though multiple lenders were unable to grant a loan on the property. Fortunately, negotiations were very clean cut with the seller, thanks to the listing agent Bryan Elliott. Bryan also managed this development so he provided many documents up front, meaning the process could move more quickly.
“It was really hairy there for about a week. I don't know if the Hegerfelds ever quite grasped how close we came to having this deal die. Meanwhile they were packing up their lives, with their apartment awaiting a new tenant. We just couldn’t give up.” - Maureen Moran
What it’s like working with Maureen
According to Jennifer, “Maureen was straight up with us about everything throughout the process. She never sugar coated anything and was always on top of it when it came to looking at places, following up and being thorough. She made the process of finding a home a lot faster than most. Her communication was also excellent. Not everyone checks their personal email every day, so if something needed to be done she would call and follow up with email to make sure we knew what was going on. Maureen is definitely a go-getter and very focused on her customers.
Because of Maureen, we found more than we thought we would actually get when we began our home search. Our condo meets all of our needs, and we didn't have to settle for less.
Once our loan finally got approved, the process was much smoother thanks to Maureen. She would follow up with everyone if something was missing and always made sure the ball kept rolling. When there’s a will there’s a way when you have Maureen working on your case.
My husband and I really enjoyed Maureen. Even though we are all set in our new home, we still miss talking to her. She felt like family, and has a good heart and a passion for helping others. I would highly recommend her to anyone, as a matter of fact I have mentioned her name a few times to others. We are so pleased with Maureen Moran, if we were to sell our place and look for another, she would be the first person we would call. I don’t know if we would have ever found our place in such a quick timely fashion like we did with Maureen.
I truly wish more people were like Maureen, it would make the world a better place.”