Condominiumization and VA Loans

In the Seattle area we are experiencing a large increase of residential lots being ‘condominiumized’ This happens when an owner turns a single family residential lot into multiple condominium lots. This allows the owner of the lot to either keep the existing house on the lot while adding a second structure, or tear down the existing home and build 2 structures. At that point, the owner can sell each structure individually.  Or, if they choose to live in one of the structures, they can sell the other structure.

Veterans who want to purchase a home with their VA benefits need to be careful when looking at homes on condominiumized lots. VA requires that all condominium buildings be VA approved and, up to this point, we have not seen homes on condominiumized lots described above be on the VA approved list. Before you decide to write an offer on one of these homes, make sure to talk to your lending professional to ensure that you can successfully close.