What Is a Non-Warrantable Condo in Brickell?

Shopping Brickell condos and keep hearing “non-warrantable”? You are not alone. Many Brickell towers mix residences, investors, and short-term rental activity, which can change how lenders view a building. In this guide, you will learn what non-warrantable means, why it matters for your financing and resale, the most common red flags, and practical steps to protect your purchase. Let’s dive in.

What “non-warrantable” really means in Brickell

A non-warrantable condo is a building that does not meet the eligibility standards used by major conventional mortgage investors like Fannie Mae and Freddie Mac. If a project is not eligible, most lenders will not sell the loan into the conventional market, so loan terms and availability can look different.

Why this matters to you:

• Smaller buyer pool. If conventional loans are limited, fewer buyers can qualify, which can affect resale timelines and liquidity.
• Different financing economics. Non-warrantable loans often require larger down payments, higher rates, and more fees, and they may use nonstandard underwriting.
• Program restrictions. FHA and VA financing may be limited or require separate project approvals. Condo-hotel setups and heavy commercial mixes often face extra hurdles.
• More due diligence. You need to review HOA finances, litigation, reserves, building safety and recertification, and rental policies before you commit.

Why a Brickell condo becomes non-warrantable

Non-warrantability is an underwriting classification. It does not mean a building is good or bad. It signals that the project does not fit standard investor rules. Here are the most common reasons in Brickell high-rises.

Short-term rental exposure

When a large number of units operate as short-term rentals, lenders see more cash-flow volatility and transient use. Even when allowed by building rules or local ordinances, high levels of short-stay activity can push a project outside conventional eligibility.

High investor concentration

Projects with many investor-owned units can have different occupancy patterns and default histories than primarily owner-occupied buildings. High investor percentages can cause a project to miss technical thresholds that conventional investors prefer.

Active or substantial litigation

Pending lawsuits about construction, structural issues, insurance, or HOA disputes can create unknown liabilities. When litigation is considered material to the project’s financial health, many lenders treat the project as non-warrantable until the issue is resolved or limited.

Reserves, budgets, and delinquencies

Lenders review the HOA’s budget, reserve study, insurance coverage, and delinquency rates. Weak reserves, high delinquencies, or likely special assessments can lead to a non-warrantable finding.

Ownership and governance concerns

Concentrated ownership by a single entity, a significant share of HOA-owned units, or an unusually high percentage of commercial space can signal market control risk or a nonresidential profile that conventional investors avoid.

Condo-hotel or mixed-use structures

If the building operates with hotel-like rental pools or a management agreement that controls rentals, conventional programs often are not available. Mixed-use projects with substantial commercial components can also face limits.

Insurance, structural, and safety issues

After the 2021 Surfside collapse, lenders, municipalities, and HOAs in Miami-Dade increased their focus on structural engineering, reserve adequacy, and recertification status. If a building has unresolved safety concerns or major repair plans, standard financing can be restricted until repairs and documentation are complete.

How agencies evaluate condo projects

Fannie Mae and Freddie Mac set the standards lenders use to determine whether a condo is warrantable for conventional financing. FHA and VA have separate approval processes and rosters. Common review factors include:

• Owner-occupancy versus investor concentration
• Percentage of units owned by one entity or the HOA
• Commercial space as a share of the project
• Active litigation and insurance coverage
• Reserve adequacy and budget strength
• Project type, such as condo-hotel or conversion
• Structural and safety recertification status

You can ask your lender to run a project eligibility check and to confirm whether FHA or VA options exist for your unit. Be ready for case-by-case interpretations and lender overlays.

Financing consequences and your options

When a project is non-warrantable, conventional purchase by Fannie Mae or Freddie Mac is generally not available. Many lenders will either decline conventional financing or require higher down payments, rate premiums, and additional conditions. FHA and VA loans typically need project approval, though some single-unit paths may exist on a case-by-case basis.

If the building you want is non-warrantable, you still have paths forward:

Portfolio loans

• What they are: Loans held by banks or credit unions instead of being sold to investors.
• Why they help: Lenders can set their own underwriting, which can allow financing in otherwise ineligible projects.
• Tradeoffs: Often higher down payments and rates, plus stricter conditions and fees.

Non-QM loans

• What they are: Mortgages that use alternative documentation such as bank statements or asset-based qualification.
• Why they help: Useful for self-employed buyers and investors who do not fit standard income documentation.

DSCR and rental-income loans

• What they are: Programs that underwrite based on a unit’s ability to cover its debt using rental income.
• Why they help: Popular with investors who prioritize property cash flow.

Hard-money or private lenders

• What they are: Shorter-term, asset-based loans that close quickly.
• Why they help: Serve as bridge financing or when a fast close or flexible underwriting is needed. Expect higher costs and shorter terms.

Single-unit FHA or VA paths

• What they are: Case-by-case options that sometimes allow a single-unit loan in a project without full approval.
• Why they help: They may open access to government-backed financing, but they require extra documentation and take more time.

Across these options, you should expect:

• Larger down payments, often in the 20 to 30 percent range or higher depending on lender and program
• Rate premiums and added lender fees that reflect program risk
• Extra conditions such as HOA reserve proof, insurance confirmations, litigation disclosures, estoppel letters, and possibly higher borrower cash reserves

Brickell-specific context to keep in mind

Brickell has a deep inventory of high-rise condos that serve primary owners, second-home buyers, and investors. Some buildings allow or attract short-term rentals, and a few operate with condo-hotel style arrangements. Post-2021, there is heightened attention on structural engineering reports, reserve studies, and 30 or 40-year recertification outcomes across Miami-Dade. These factors can affect warrantability and timing for your loan.

What to do before you write an offer

Prepare early so you can move quickly with confidence. Use this due diligence checklist.

Building and HOA documents

• CC&Rs, bylaws, and rules, including rental and lease policies
• Any condo-hotel or rental pool agreements
• Current budget, reserve study, recent audited financials
• Delinquency data and any special assessments
• Litigation disclosures, settlements, or legal opinions
• Master insurance policy, flood coverage, and HOA fidelity bonds

Building condition and safety

• Recent structural engineer reports
• 30 or 40-year recertification status and permits for major work
• Records of recent repairs or evidence of deferred maintenance

Local rules and short-term rental status

• Building rules for short-term rentals and minimum lease terms
• City of Miami and Miami-Dade ordinances or permitting expectations

Lender preparation

• Ask for a project eligibility check on your specific building
• Confirm available loan products and expected down payment and rate range
• Request the lender’s condo documentation list in advance
• Discuss timing for appraisal and any extra condo review steps

Appraisal considerations

• Ask whether there are sufficient comparable sales in the building or nearby
• Confirm whether marketability issues could influence valuation

Estoppel at contract stage

• Obtain an estoppel letter from the HOA to confirm fees, assessments, and outstanding obligations before you proceed to closing

Pricing, liquidity, and strategy in a non-warrantable building

A non-warrantable classification can reduce the pool of qualified buyers, which may affect time on market and negotiation dynamics. If you plan to resell within a short window, account for that smaller buyer pool early and price with realistic expectations. If you plan to hold for income, weigh the financing cost, the building’s rental posture, and the long-term outlook for reserves, maintenance, and recertification.

Investors often use portfolio, DSCR, or non-QM loans when the property’s cash flow or long-term appreciation case makes sense. The key is stress-testing the investment with conservative financing terms and setting aside reserves for potential HOA assessments or insurance changes.

Avoiding surprises in Miami-Dade’s recertification environment

Local recertification requirements and the broader focus on structural health can influence risk, insurance, and timing. Ask for recent engineer reports and a clear plan for any upcoming major work. If the building faces large repairs or unresolved safety items, expect lenders to ask for extra documentation or to limit conventional options until issues are resolved.

Work with a team that understands Brickell condos and financing

Choosing the right Brickell condo is not just about the view or amenities. It is also about underwriting, risk, and a realistic plan for ownership. With an integrated approach to brokerage, financing, and management, you can identify issues early and keep your deal moving.

If you want a clear assessment of a specific building, help obtaining the right loan product, and a smooth handoff to property management, reach out. Call or Text Sean Greco for a focused game plan that covers project eligibility, financing options, and long-term ownership support.

FAQs

Can I use FHA or VA in a non-warrantable Brickell condo?

• Generally you need project approval, though some case-by-case single-unit paths may be possible with added documentation and time.

Are condo-hotel units always non-warrantable in Brickell?

• Many condo-hotel structures are ineligible for standard conventional programs, but eligibility is decided case by case based on project details.

Does non-warrantable mean the building is a bad investment?

• Not necessarily, it reflects financing standards rather than quality, though you should plan for a smaller buyer pool and different loan terms.

How do I confirm if a specific Brickell building is warrantable?

• Ask your lender for a project eligibility check and review HOA financials, litigation, insurance, and recertification with a local expert.

What down payment should I expect on a non-warrantable condo?

• Many alternative programs require larger down payments, often in the 20 to 30 percent range or higher depending on the lender.

What documents should I request from the HOA before I commit?

• Ask for governing documents, rental policies, budget and reserves, delinquency data, insurance, litigation disclosures, and recent engineer reports.