Condo-tel financing can be tricky. Not all lenders or brokers will do it. We have multiple outlets and close them as primary residences, second homes, or investment properties. 25% down with a 660+ score.

Condo-tel Financing in Florida

Condo-tel financing in Florida can be tricky. Not all lenders or brokers will do it. We however have multiple outlets that we can finance condo-tels through. There are a few caveats between the different outlets but the main principles are the same. We will break it down for you. Condo-tels can be a great investment property, second home, or even a primary residence, but first, what exactly is a condo-tel?

A condo-tel is essentially a mix between a condominium and a hotel. Hotel like amenities can be expected but you have ownership like a condominium. Additionally the management company of the community can offer to rent your unit out when it’s not in your own personal use. This can provide additional income and subsidize the cost of your vacation home. Oftentimes amenities can include a pool, water park, bar, game room, a lazy river and more. The convenience of letting the management of the community keep your unit generating cash flow and maintaining the unit is a hassle-free way to enjoy your condo-tel in Florida.

Orlando, Miami, Sarasota, Fort Walton Beach and surrounding areas all have condo-tels worth any shopper’s attention. The big question is how much do I need down? Here is the breakdown. With a 660 or higher credit score you will need 25% down. If it’s less than 660 30% down will be needed.

Basic Requirements to Finance a Condo-tel in Florida

• Construction must be complete for the phase you are purchasing in.
• Leasehold communities are allowed if the lease is 30 years or longer, for investment properties 15 years is the minimum.
• No structural deficiencies.
• A questionnaire must be completed by the owners association.
• Kitchens are typically required, but a kitchenette may be acceptable if there is a built in cook top.
• If the unit is less than 500 square feet then the minimum down is 30%.
• Co-insurance is considered on a case by case basis.
• Certain pending litigation might disqualify the community.

What Kind of Income Do I Need to Show?

There are different methods for qualifying that your income is sufficient to finance a condo-tel in Florida. We can use tax returns like traditional financing, or bank statements if you are self employed. If you are buying it as an investment property we can even use what’s called debt service coverage ratio financing to qualify.

What Is the Drawback to Buying a Condo-tel in Florida?

Interest rates can be higher on these loan products depending on what income you plan to use to qualify. If you are using tax returns to qualify we have very competitive rate options in line with market rates. When using bank statements or other unconventional methods you can expect a higher than market interest rate.

Keep in mind that you are locking yourself into one community when buying a condo-tel. There are however ways to exchange time with other vacation home owners in other communities to give you some flexibility on your vacation destination. Also remember that when the community manages renting your unit out they will charge a fee or a percentage to do so.

What’s the Difference Between a Condo-tel and a Regular Condo?

First thing is first, a regular condo is a residential community where most owners live in their units full-time or as a second home. A condo-tel operates like a hotel. The management company runs a front desk, housekeeping, daily check-in/check-out, and a rental program. Lobby, pool, and amenities are open to non-owner guests. The IRS and most lenders treat condo-tels as a non-warrantable property type for that reason. They don’t fit the conventional Fannie Mae or Freddie Mac box because the building isn’t operated as a residential community.

That’s why condo-tel financing is its own product. Most national banks won’t touch it because they can’t sell the loan to Fannie or Freddie. We work with non-QM lenders and portfolio lenders who underwrite condo-tels specifically. The pricing is typically 0.5% to 1.5% higher than a regular condo loan, but the program exists and we close them every month.

Common Florida Condo-tel Communities We Finance

Florida is the condo-tel capital of the country. We see and finance units in:

• Orlando area: Disney-adjacent communities in Kissimmee, Davenport, Reunion, ChampionsGate. The vacation rental traffic is consistent year-round, which makes the rental income side of the math attractive.
• Panhandle: Destin, Miramar Beach, Fort Walton Beach, Panama City Beach. Beach-front condo-tels with strong summer rental seasons.
• South Florida: Miami Beach, Sunny Isles, Sarasota. Higher price points, year-round rentability.
• Cocoa Beach and Cape Canaveral: Smaller market but strong cruise port and space coast traffic.

Each community has its own approval status with our condo-tel lenders. Some communities are pre-approved and the financing process is fast. Others require a project review at the start of the file. We can usually tell you within 24 hours whether a specific community is approvable.

Florida Condo-tel Financing FAQ

Get a No Hassle Condo-tel Pre-Approval

Send us the community name, your scenario, and how you plan to use the unit (primary, second home, or rental). We’ll come back with project status, pricing, and the down payment math.