Video update

Hi all,

A big issue has come up recently for financing condos without sufficient master hurricane insurance.

Update:  Master Hurricane Insurance Gap Lending Options

Fannie Mae and Freddie Mac, the Government-Sponsored Enterprises (GSE’s) that set the guidelines for conventional loans, which most lenders follow for other types of loans, too, require that a condo building’s master hurricane insurance policy provide 100% coverage of the replacement value for the building. 

For various reasons, there are many condo buildings in Hawaii that currently don’t have sufficient master hurricane insurance coverage to meet this requirement.  As a result, most lenders can’t finance units in these buildings. 

Local Lenders not Offering Financing for Master Hurricane Insurance Gap Buildings

Local lenders are currently not offering financing for these buildings that don’t have sufficient master insurance coverage.  The one local lender who had decided to finance these buildings with restrictions when the borrower had their own “gap hurricane coverage” has suspended offering this financing.

Fortunately, we can still finance these buildings using two of our national lenders.  See below.

National Lenders

Fortunately, one national lender we work with has confirmed with their head of credit that they have no minimum coverage requirement for condo master hurricane insurance.  They do full documentation, bank statement, jumbo, foreign national, asset dissipation, and DSCR loans, but not conventional, VA, FHA, or USDA loans, with a minimum 10% down payment.  Their rates are a little higher than a conventional loan, with rates varying quite a bit depending on the down payment, credit score, type of loan, and other factors.

Another national lender we work with has a condo department that hasn’t been checking the master hurricane coverage on conventional, VA, FHA, USDA, or jumbo loans, but we don’t know how much longer that will be the case.

We currently have loans in process with both of these lenders, and have recently closed loans with them in these buildings. 

If anyone wants more details on the background and intricacies of this issue, please feel free to call me.

Please let us know if we can help with any buyers or listings you have for these buildings.  We have a great team of 10 loan officers who can help.

Aloha,

Duncan Hsia

Owner, Loan Originator NMLS # 998053

Infinite Financial, LLC NMLS # 1866302

Life insurance license # 475332

1050 Queen St., Suite 100, Office A2

Honolulu, HI  96814

Cell: 808-489-1067
Fax: 808-649-3885

duncan@infinitefinancialllc.com

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