Condo basics
A condominium is a home you own within a building or complex of buildings that features multiple units. However, you only own your individual unit, and you own a percentage of common areas alongside other condo owners in your condominium association. Like traditional homeowner associations, condo associations are responsible for the maintenance and operation of shared areas of the building and shared outdoor spaces.
How condo mortgages work
A condo mortgage is a loan for a condominium. You can get a condo mortgage through a mortgage lender, just like you would with a single-family home. You can generally get condos with conventional loans, Federal Housing Administration (FHA) loans, Veterans Affairs (VA) loans, U.S. Department of Agriculture (USDA) loans or jumbo loans.
Depending on the loan program you’re interested in, you’ll need to meet specific loan, borrower and property requirements.
» MORE: Buying a condo vs. a house
Types of condo mortgages
When it comes to condo mortgages, you can use the same loan types as you can for a single-family property.
Conventional loans
Conventional condo loans typically require a down payment of at least 3%, though you’ll need to put at least 20% down to avoid paying private mortgage insurance (PMI). Conventional loans can come in conforming and nonconforming loan types.
Conforming loans
A conforming conventional loan must meet set guidelines from government-sponsored programs, such as Fannie Mae and Freddie Mac. To qualify for a loan, condos can’t exceed maximum loan amounts and borrowers must meet specific credit criteria, among other requirements. For example, only up to 15% of the units in an established condo project can have condo association fees 60 days or more overdue.
Nonconforming loans
Nonconforming condo loans don’t have to adhere to government-set criteria, like maximum loan amounts. For example, jumbo loans are a type of nonconforming loan. These loans are typically used for high-value properties, like luxury condos, so their minimum credit score and down payment requirements are usually higher than for conventional loans.
» MORE: What is a jumbo loan and am I eligible?
FHA loans
If you need a loan with a low down payment requirement, you might be interested in an FHA loan. This type of home loan requires a 3.5% or 10% down payment, depending on your credit score. You can look for approved condos using the U.S. Department of Housing and Urban Development’s (HUD) online tool.
To be approved for an FHA loan, your condo must meet the following requirements:
- The building or complex has at least five units
- At least 50% of the condo units are owner-occupied
- Nonresidential space should not exceed more than 35% of the total floor area of the condo project
VA loans
VA loans help eligible military members, veterans and eligible family members purchase a home without a down payment. VA loans come with competitive interest rates, limited closing costs and no requirement for PMI. The VA has a list of approved condos, but you may be able to buy a condo that’s not on the list by submitting a proposal to the VA.
To qualify for a VA loan, the condo must meet the following criteria:
- At least 75% of the units must be sold
- At least 50% of the units must be owner-occupied
- At least 75% of unit owners must be current on condo association dues
- No more than 10% of the units can be owned by a single entity
USDA loans
USDA loans allow eligible borrowers in qualified rural locations to buy a condo or home without a down payment. You’ll need to receive approval from the USDA to get a condo. USDA loans have guidelines that are similar to those set by the FHA and VA, including:
- The condo must have flood insurance if it’s located in a risky area
- The condo must be structurally sound
Pros and cons of a getting a condo mortgage
Condos are a popular option with those who appreciate apartment-style living, shared spaces and limited maintenance and repair responsibilities.
Pros
- Typically cheaper than single-family homes
- Maintenance is typically handled by a condo association
- Popular in cities and urban areas
- Usually in convenient locations
Cons
- May be more challenging to secure financing
- Condo owners must pay condo association fees
- May be harder to sell down the line
Is a condo mortgage hard to get?
Getting a condo mortgage may be more challenging than getting a single-family home mortgage for a number of reasons. Lenders will typically consider:
The condo’s financial situation
Mortgage lenders need access to more than just the applicant’s financial history and situation — they also need to know about the condo’s situation.
Michael Borodinsky, a branch manager of loanDepot, a mortgage lender, said that lenders need to assess not only the creditworthiness of the borrower but also the financial health and management of the condo association.
“Condo mortgages may require more thorough reviews of the condo association's bylaws, financial statements and insurance coverage to ensure the property is financially stable and meets the lender's requirements,” Borodinsky said.
Future condo expenses
Future condo expenses may need to be considered, too. This could happen if a condo building requires unexpected repairs or major component replacements. If its association hasn’t managed its funds well enough to pay for those repairs from its regular cash reserves alone, condo owners will need to shell out extra money beyond their usual monthly dues for what’s called a special assessment. In that case, condo buyers may be walking into a situation in which they’ll owe a lot of money in the future, and that can impact the mortgage process.
Construction plans
Additional requirements may be necessary if a condo is under construction. In that case, lenders have to assess current sales and construction completion plans before approving the project and agreeing to provide mortgage financing.
However, Borodinsky said that builders of new condominium projects typically work with a preferred lender. This lender secures project approval in advance so buyers can proceed without jumping through as many hoops.
FAQ
Are interest rates higher on condos?
Interest rates for condos can be slightly higher than interest rates for single-family homes because condos can be seen as riskier investments.
Are condo fees included in your mortgage?
Condo fees typically aren’t wrapped into a mortgage payment. Instead, they’re paid directly to the condo association.
How long is a condo mortgage?
Like other types of home loans, condo mortgages typically last from 10 to 30 years. Ultimately, the length of a condo mortgage depends on what the borrower wants and can qualify for.
Are condos cheaper than houses?
Condos can be slightly cheaper than single-family homes, though it depends on where the condo is located and what amenities are offered.
What is a warrantable condo?
A condo is deemed warrantable by a government-sponsored program, such as Fannie Mae or Freddie Mac, and it must meet their set guidelines. For example, for a condo to be warrantable, its association must have enough cash in reserves for maintenance and repairs, and the owner of the unit must typically inhabit the property for a certain amount of time each year.
Bottom line
Condos can be a good investment for many, but they tend to come with stricter mortgage approval guidelines. However, they’re generally cheaper than single-family homes, so you may save more money overall by choosing a condo over a house. Just remember that you’ll have to deal with monthly association fees and other ongoing costs.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Freddie Mac, “Condominium Unit Mortgages and Project Reviews.” Accessed Nov. 22, 2025.
- U.S. Department of Veterans Affairs, “VA Home Loans.” Accessed Nov. 22, 2025.
- U.S. Department of Housing and Urban Development, “Condominiums." Accessed Nov. 22, 2025.
- U.S. Department of Housing and Urban Development, “FHA Single Family Housing Policy Handbook.” Accessed Nov. 22, 2025.
