What is the current mortgage climate in the area for vacation homes? I had a mortgage agent tell me here in Kentucky that in Florida, in order to get a conventional mortgage, you would have to put down at least 30% to get a conventional mortgage, and that for smaller full condos (with full kitchen, separate bedroom) under 800 square feet you can't even get a conventional mortgage.

There is a certain price point where we can certainly afford a mortgage, condo fee, utilities, cable, insurance, etc without having to rent it out at all to cover costs, but would like to rent it on our own to help offest (any fees back is better than no fees back IMO), but it would we could afford it if we didn't rent at all.

Was just wondering whether the mortgage agent here was right or not. There are lots of smaller full condos out there under 800 square feet.

I would suggest contacting a local lender. I can refer you to several if you would like. I can remember back in the mid 90's out of state companies did not want to lend money for any beach property. The customer would have no problem finding a loan from our local businesses. Good luck.

I am evaluating this issue as well. One option I am considering is joining a local credit union that has an internally sourced product that fits our needs. Typically you have to be a local resident but it appears you can qualify through membership in a qualifying association. Many traditional banks have the feds looking over their shoulders on every conventional loan plus I believe they are motivated to guide you towards a premium rate nonconventional product to help prop up their loan book. Credit unions on average run much lower leverage ratios and I suspect have fewer problems on their balance sheets. As a result they may have more flexibility and more reasonable rates with their internally sourced product.

Eglin FCU only underwrites single family primary residences. (Works for them. They've had an extremely low foreclosure rate during the bust) Tyndall FCU does loan for condos and investment properties but it likely to be pretty picky about which buildings they'll loan for. Army Aviation FCU is probably pretty similar to Tyndall.

If it's a condotel, you probably can't get a conventional mortgage. Size does matter unfortunately as lenders will view a smaller unit in a resort area as an investment property even if the plans are to utilize as a second home.

I think all (investment) condos in FL now will need at least 20% down and if it is a condotel, the 30% is correct.....maybe even 35%, depending upon the lender. Guidelines are changing rapidly so consult a bank or lender in the area.

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