I had a similar experience... tried to refinance my mortgage with Liberty Savings Federal Credit Union in Jersey City. I own a ground level condo of a 4-unit brownstone... very typical of the condos found in DTJC. However, LSFCU denied my refi because the real estate appraiser couldn't find any comparable properties in JC! Amazing. In addition, they put a bunch of lies about the state of my credit on the rejection letter (my credit is flawless) because their policies do not allow them to reject a refinance for only one reason. So, even though there really was only one (very mistaken) reason, they rejected me anyway in violation of their policy. The appraiser later came back with a number but by then my application had expired and I would have had to pay application fees again. And who would want to have a mortgage with this institution?

Sorry to the OP if I hijacked your thread. I just wanted to say that a rejection isn't universal. Banks have different (and sometimes very messed up) policies. I would also warn against mortgaging with a local bank or credit union. They're not subject to the same regulations as big banks, something I learned when I tried to file a complain about their unethical practices. Good luck!

Last time I did anything with them was a few years ago (helping someone else get a construction loan). I wonder if the chaos you experienced has to do with the merger with Pamrapo?

My dealings with the past two years has been routine banking stuff like checking.

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When was your last loan with them? They've been a complete fustercluck for at least the last 20 months. They had all sorts of chaos and turnover, their underwriting is completely unable to process anything in a rational or timely way.

Most recently I was trying to get them to refi a loan they held, and they couldn't even get me to the appraisal point. Can you imagine calling a bank officer you've been doing business with for 15 years about a new loan and being told to call back in a week, they can't take in new business right now?

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I had the same problem with a condo apartment in JSQ. Finally went with Pinnacle Mortgage. If you need some references you could PM me. I was wary of the same risks when I will sell, but still went ahead with the contract based off the thought that it was still a decent price I paid, the rate I got was low (locked in Feb 2013) and that there have been more sales in the recent years in these apartments (so the tenant/owner ratio will improve).

However, you will not get a Fannie/Ginnie Mae lower rate loan since they've started requiring stricter standards since Oct 2012.

Try Investors ...
Jeff Kapnick
Sr. Loan Officer
Top Producer Award 2009 - 2011
ML# 223102

jkapnick@myinvestorsbank.com
732.431.5708 ? office
973.969.9242 ? fax
www.jumbomortgagenj.com

Bayonne Community Bank.

I can't get a mortgage that is packaged by Fannie or Freddie, so my entire portfolio is with them. Working with BCB has been painless. They have excellent customer service. I have been using them for close to a decade now.

guys the property is not canco to be clear.. my first target in home search is canco but passed it.

I had a similar situation earlier this year in buying my condo where Fannie Mae denied the mortgage I was applying for through Investors Savings Bank. Reasoning was "less than 50% was owner occupied" (It was *just* under half owner occupied, which was rather annoying as I was told they were including the 2 other units for sale at that point as renter occupied, even though both have sold since and is now occupied by the owners)

Basically, Investor's changed gears on the news that fannie mae denied the loan and had me reapply for a different type of mortgage that had MUCH stricter paperwork (e.g. original signature/no photocopied signature requirement on all documents, additional bank statements, additional proof of income, etc) but in the end allowed me to purchase the condo.

Make sure though that even if you pick a bank that you know can offer a mortgage in these situations, that they know that another bank denied the mortgage and why they denied it. The bank that you find may have more than one type of mortgage and may have to chose one according to your needs.

To OP, this is common in condos as it is a requirement for them to sell the mortgage. The failure in this case is DD isnt done by you and/or your mortgage broker before going into attorney review.

Any good mortgage broker should have at least reminded you that, and you should got the condo questionnaire from the management and insisted the broker run it through first before going into attorney review.

Right now the only way to salvage the situation is find a local community bank or credit union (maybe) who HOLDS their mortgage and does not sell them. Then they dont have to abide by the occupancy rule as long as you can convince them your creditworthiness.

2nd option is see if you can get a mortgage on one of your existing unit (if you have multiple) who satisfies the lending requirement then use this money to buy the property in question in cash.

I dont see any other alternative but walk away and eat your closing cost loss otherwise. Consider lesson learned.

OP - I live in Canco, hence my question - and can put you in touch with a lender, of course. But I'm wondering where you got the numbers of <50% owner occupancy rate and one party owning 15% of all units...? Unless we're no longer talking about Canco? (I see that another thread of yours refers to you in contract with a developer that's recently renovated your target condo - Canco is new development, not a reno)

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I haven't heard of a lot of "red flags" associated with Canco. It sounds like a typical development project.


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I don't think there was some massive ethical breach here. More likely is that the OP is a first-time or inexperienced buyer, and didn't know to watch for this, or missed it when they were told about it.


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Erm... The real estate agent doesn't get paid until the sale goes through. If the buyer can't get a mortgage, the agent doesn't get paid.

I.e. the real estate agent has nothing to gain, and everything to lose, by neglecting to mention this.

If anything, the OP should be talking to his real estate agent to find a mortgage broker who works on Canco. People have been buying in those buildings for about 5 years, so surely they exist.

First, can someone merge this thread in with your other thread about this condo purchase? It answers the question about whether you are buying at canco.

Second, how many red flags do you need to walk away from this property?

I do not know who was legally or ethically responsible for advising you about these risks, but the fact that your real estate agent didn't is troubling. Mine informed me upfront about these issues so we could factor into whether we wanted to pursue a property.

Is your agent in cahoots with the developer? I already thought you were getting bamboozled when you posted on the other thread.

Best of luck.

FYI, we went with guaranteed rate, who sold our mortgage one months later to someone who sold our mortgage to another lender (who failed to pay our taxes). No joke....3 lenders in 7 months. 13 years of dealing with mortgages in JC and we've never experienced anything like this. I would NOT recommend Guaranteed Rate to anyone.

Are you buying in CancoLofts, as your name suggests?

thanks for all the replies. I'll try a few more mortgage providers. And if it still doesn't work I'll eat the result and walk away. Even if I get this property at the end and if the condo situation remains the same when I sell the unit in a few years, I'll be in trouble because buyers will have trouble getting mortgage.

I put 30% down for this purchase.

Next time I'll be very careful about the condo situation before signing contract.

If your name is an indication, and you're buying in Canco Lofts, I'd check with the developer. I'm sure they've lined up a couple of mortgage brokers / banks by now.

Pinnace (a mortgage broker) may also know of a bank willing to loan under those circumstances.

I was in a position where I was denied a loan because there was an issue with the developer holding & renting x% of the units that are not actively on the market.

It's very discouraging, but I would just call a bunch of mortgage companies until you find one that can help. A good place to start would be contacting the developer and getting a list of mortgage companies recommended by them and find out who recently was able to close at that particular development.

As far as who is responsible for catching such things, I have no idea. I do understand your frustration however because I went through a period of anger and helplessness myself.

Best of luck.

First question to ask is whether you want to buy into a building with these numbers. If so, you could try a portfolio or direct lender, like GuaranteedRate, Investors or Pinnacle. If you bail on the deal, ask your agent to do a little homework before you make the next offer. A quick check of the tax records *might* give insight on owner/occupied numbers (assumes owners are giving correct residence addresses), and your agent can ask these questions of the other side or their management company. If sellers don't want to answer before a contract is signed, make sure your attorney gets it done before review is concluded. Good luck.

Which bank denied you? From looking at the tax records, it looks like quite a few people use Wells Fargo.

I've got no knowledge of condos, but I've dealt with some asshat banks. Try another bank. I had a bank deny a loan on a 4 family with good cashflow because it was railroad apartments and was grandfathered into the ubiquitous R-1 2 family zoning. They were obviously befuddled by urban loans, another bank, Investors, was no problem at all.

Can you try other mortgage companies and see if they will give you a mortgage?

Best of luck!!!

because
1 owner occupancy ratio < 50%
2 one sponsor owns 15% of units.

Now I am very deep into this contract. If I exercise the mortgage contingency I'll still pay attorney/inspection/appraisal fee and waste 1month time on this failed purchase.

I wonder Who is supposed to catch the problems of the condo project so that I could avoid getting deep in to this contract..

Is attorney supposed to catch this in attorney review and alert me? or is mortgage broker supposed to alert me as soon as he gets the appraisal or condo questionnaire?