Wells Fargo Home Mortgage Plays White Knight in Steamboat Springs

Part II of II part blog on Condo financing in Steamboat Springs Colorado.

Read Part I: The Google Factor and other Toxins that hurt Condo Financing in Steamboat Springs

As I mentioned in Part I of this series, Wells Fargo Home Mortgage is currently lending on most (not quite all, but most) condos in Steamboat Springs. Wells Fargo is the White Knight, charging in, so to speak, to prevent what could otherwise be a vary dire lending situation within the condominium market in Steamboat Springs Colorado.

I spoke to Lynn Reiff at Wells Fargo, who sent me the following information. You’ll note that their “Resort Condo” is what most lenders are currently calling Condo-tels (and not lending on) and that their definition of Condotel is something else entirely: 

 WF classifies condos as either REGULAR, RESORT or CONDOTEL.

Villas at Walton Creek - Regular Condo

•  REGULAR condos would include Sunray, Quail Run, Villas at Walton Creek, The Pines, etc.  These do not have front desks. On those purchased as a primary home Wells Fargo has been able to lend up to 90% of loan-to-value (meaning 10% of the total price of the condo needs to paid by the borrower as a downpayment at closing; 90% of the total purchase price can be financed), making these “regular condos” much more affordable, lending-wise, than “resort condos” below.  Second homes may go to 80% LTV (with the conventional 20% downpayment amount), but get better rates at 75% LTV (with a 25% downpayment).  Both fixed and adjustable rates are available.

Trappeurs Crossing - Resort Condo

• RESORT condos would include Trappeur’s Crossing, The Ranch, Canyon Creek, Eagle Ridge Lodge, The Lodge at Steamboat,  Timber Run, etc.  These do have a front desk. They require a minimum of 30% down (70% LTV) and have additional requirements: the borrower needs to have the equivalent of 20% of the loan amount in liquid assets like cash after closing, and the borrower has to set up an automatic debit from a Wells Fargo checking acct for the monthly mortgage payment to be paid from.  So, for example, if the purchase price is $400,000 the borrower would need to put  $120,000 (30%) as downpayment and could borrower the remaining $280,000 (70%). Additionally,  they would need to have another $80,000 in liquid assets like cash stashed away in an account somewhere. So basically, the borrower would need to have the equivalent of 50% of the purchase price available to them in cash to be able to borrow the other 50%. this doesn’t make it easy for the average person to buy a resort condo in Steamboat, but at least it makes it doable for the person that can come up with 50% cash, which is better than the only buyers being those that can pay 100% cash! Wells Fargo offers both 30 year fixed rates as well as Adjustable Rates for this classification of condo.

Torian Plum - Condotel

• CONDOTEL – Torian Plum at the base of the ski area is an example.  These are condos that have commercial space in the building. They currently have no financing for these.

New Construction Condos 

• Yes, if 70% presold. Many of the projects were 70% presold, but have since “fallen out” of the 70% bracket, by buyers not closing on those initial contracts.  This would include First Tracks.  They cannot currently lend there.

The Olympian - New Construction

•    Yes, if Wells Fargo holds the Construction Note. Where Wells Fargo Bank has been involved with the construction loan (the downtown Condotels TheVictoria and The Olympian) they do have Portfolio money available for loans, which means they are able to lend money from their own in-house funds.  They are not offering fixed rates on these, only 3/1 and 5/1 adjustable rates.

Getting a mortgage to buy a condominium in Steamboat Springs definately isn’t as easy as it used to be, but as long as buyers and sellers are knowledgeable  and realistic about what is and is not possible, the market moves forward and begins to pick up traction, with a certain white knight leading the charge.