Many people move to Florida or get second homes here to take advantage of the weather and the many amenities we enjoy in the Sunshine State. But if you’re buying a condominium or a home in a planned community, your homeowner’s association (HOA) fees can affect your ability to get a Florida mortgage.

If the home you want to buy is part of a multifamily community or a planned unit development (PUD), you’ll probably automatically become part of the community’s homeowner’s association. The HOA typically maintains common areas and amenities, like clubhouses, gated security, fitness centers, or swimming pools. Homeowners in that community pay dues to maintain and repair these amenities and pay for insurance for these areas. Each HOA is different based on the type of community and the amenities the community offers.

If you buy a home outside a planned community, you’ll still need to maintain and repair your home, but those costs are at your discretion. Mortgage lenders don’t factor that type of expense into your debt-to-income (DTI) ratio.

However, HOA dues are required. Every homeowner in the community must pay these fees, or the HOA will take action to collect them. For that reason, HOA dues are counted in your DTI ratio. If you’re qualifying for a Florida mortgage at the maximum DTI or debt-to-income ratio, make sure everyone is aware of the HOA dues as they may affect your ability to qualify.  This shouldn’t occur when you are in process, as this is an upfront question seasoned Loan Officers are always asking when seeking a Florid mortgage.

Getting a Florida mortgage for a property bound by an HOA can also require more paperwork. The mortgage lender may sometimes need to consider the financial health of the HOA, the ratio of owner-occupants to investors, and other factors. Typically, the lender will require the HOA to complete a questionnaire to assess the HOA’s strength. This is a common requirement when purchasing a Condominium here in Florida.

If you’re considering getting a Florida mortgage for a property with an HOA, Embrace Home Loans can help you. We have extensive experience in working with HOAs, and we’ll help you assess the HOA and streamline the qualification process. Contact us at 407-733-6425 for more information.