Heard someone call a Denver condo “non‑warrantable” and wondered what that means for your offer or loan? You are not alone. In high‑rise markets like Downtown Denver, warrantability can decide which mortgages you can use, how fast you can close, and even your future resale options. This guide breaks it all down in plain English so you can spot issues early, confirm a building’s status, and line up the right financing. Let’s dive in.
What “warrantable” means
A warrantable condominium project meets the eligibility standards set by Fannie Mae and Freddie Mac for conventional loans. When a project is warrantable, lenders can use conforming loan products that are widely available and often lower cost. You usually see smoother underwriting, more lenders to choose from, and better down payment and rate options.
If a project is non‑warrantable, conforming loans may not be available. That pushes many buyers toward portfolio or jumbo financing, different approval paths, or cash. It can affect affordability today and marketability when you sell later.
Why some Denver condos are non‑warrantable
Downtown Denver towers and nearby urban buildings often face issues that trip project‑level reviews. Lenders apply agency rules and their own overlays, and borderline items can be interpreted differently. Here are the most common triggers to watch:
- Pending or active HOA litigation. Lawsuits over structural or construction defects, water intrusion, or association disputes raise risk and uncertainty.
- High concentration of ownership. One developer, LLC, or investor group holding many units can limit owner‑occupancy and concentrate control.
- Excessive commercial or mixed‑use space. A large share of retail or office space changes the project’s risk profile.
- Low reserves or missing reserve study. Inadequate reserves increase the chance of future special assessments.
- High owner delinquency on dues. Cash‑flow issues inside the HOA make lenders cautious.
- Substantial short‑term rentals. A high share of short‑term occupancy can affect stability and compliance with agency limits.
- Recent conversions or developer control. Rental‑to‑condo conversions and projects still under Declarant control often face extra scrutiny.
- Insurance gaps or lapses. Missing or insufficient master insurance is a common disqualifier.
- Unusual legal structures or restrictive rules. Nonstandard CC&Rs or encumbrances can complicate collateral and remedies.
- Age or condition problems. Known deferred maintenance or code issues can signal expensive repairs ahead.
How to verify a building’s status
You want answers before you write or finalize an offer. Start collecting documents and involve a condo‑savvy lender early. Use this step‑by‑step approach.
Request these HOA documents
- Completed condo/project questionnaire that lenders use for reviews.
- Declaration/CC&Rs, bylaws, and articles of incorporation.
- Most recent annual budget and current operating budget.
- Reserve study and proof of reserve funding or balances.
- Master insurance declarations, including coverage types and deductibles.
- Owner occupancy summary or roster with owner‑occupied vs investor counts.
- HOA board meeting minutes from the last 6 to 12 months.
- Written status of any pending or threatened litigation.
- Details on commercial space and leasing shares within the project.
- Any conversion or developer control documentation.
- Any available certifications about code violations or municipal notices.
Run third‑party and public checks
- Ask your lender to run the project through Fannie Mae or Freddie Mac project review services or their internal databases.
- If relevant, check whether the project appears on FHA or VA approved condo lists.
- Review Denver County recorder and court records for liens, judgments, or lawsuits.
- Check the City and County of Denver building permit and code compliance records for open permits or violations.
- Request a preliminary title report to uncover HOA‑related encumbrances or special assessments.
Ask your lender the right questions
- Do you offer loans in non‑warrantable projects and what products are available?
- If the project fails an agency review, can you consider a single‑unit approval option?
- What exact HOA documents do you need and how long does your condo review take?
- What timing should we plan for title to clear HOA‑related items or assessments?
Spot red flags fast
- Litigation tied to structural components or HOA finances.
- Low or no reserves and no recent reserve study.
- High investor or single‑entity ownership, or many short‑term rentals.
- Budget shortfalls and multiple recent special assessments.
- Insurance gaps, unusually high deductibles, or recent policy cancellations.
Financing if a project is non‑warrantable
Non‑warrantability does not automatically end your purchase. You still have options, though terms and timelines may differ from agency‑backed loans.
- Portfolio loans. Many local and regional banks or credit unions will keep the loan in house and apply more flexible standards. Pricing and down payment needs vary.
- Jumbo loans. If your loan amount is above conforming limits, a jumbo product may fit. Lenders often apply their own condo criteria.
- FHA or VA loans. Possible only if the condo project is on the relevant approved list. Approval is separate from Fannie Mae and Freddie Mac rules.
- Specialty single‑unit or exception programs. Some lenders will consider a unit‑level path or specific allowances for nuanced issues.
- Cash or seller financing. Less common, but sometimes used when timing or guidelines constrain other choices.
Protect your contract
- Use a financing contingency that specifies the loan type and allows you to exit if the project does not pass or if the alternative terms are not acceptable.
- Set document deadlines that require the seller or HOA to deliver the questionnaire, budget, reserve study, insurance, minutes, and litigation disclosures promptly.
- Build in time for lender condo project review. Reviews can take several days to a few weeks.
Denver‑specific insights
Downtown and close‑in neighborhoods feature a mix of purpose‑built towers, condo conversions, and mixed‑use buildings with retail or office components. These traits increase the odds of investor concentration, short‑term rental activity, or extra documentation for conversions. High‑rise construction or water intrusion issues have led to HOA litigation in some buildings in past cycles, which lenders weigh carefully.
Colorado’s HOA landscape is guided by the Colorado Common Interest Ownership Act, which sets many governance and disclosure standards buyers rely on during due diligence. At the local level, the City and County of Denver maintains building permit and code enforcement records that can reveal open permits or compliance matters. Denver County recording and court records can surface liens, judgments, or lawsuits that may affect a project’s status.
For a smoother path, work with lenders, title companies, and attorneys who regularly handle downtown condo transactions. Professional HOA management companies that serve larger towers can also help you obtain questionnaires and complete documentation on schedule.
A smart buyer’s action plan
- Before you tour: Speak with a lender who understands Denver high‑rise condos and performs project reviews.
- Before you offer: Ask the listing side to confirm HOA document availability and turnaround times, and prepare a financing contingency.
- At offer: Request the project questionnaire and key HOA documents with explicit deadlines in the contract.
- During due diligence: Have your lender review the project and update you on any issues, pricing changes, or alternative loan paths.
- Before deadlines: If the project is non‑warrantable, decide whether to proceed with a portfolio or jumbo option, adjust terms, or terminate under your contingency.
How a specialist adds value
When you buy or sell a downtown condo, building‑level insight matters. A local specialist can anticipate warrantability concerns, press for complete HOA documentation, and coordinate with lenders and title to keep the review on track. If you are considering a tower like SPIRE or a similar amenity‑rich building, this detailed approach helps you price correctly, choose the right financing path, and protect your timelines.
If you want to benchmark a unit’s marketability or confirm a building’s review history, you can get a structured checklist, document request templates, and lender introductions from a downtown‑focused advisor. That level of preparation can save you time, money, and stress.
Ready to move forward with confidence on a Denver condo purchase or sale? Connect with Mark Callaghan to get a building‑level game plan and Request your Downtown Denver Market Update.
FAQs
How can I tell if a Denver condo is non‑warrantable before I make an offer?
- Ask for the condo questionnaire, budget, reserve study, owner‑occupancy breakdown, insurance, and litigation disclosures, then have your lender run a project review and include a financing contingency.
Can I get a mortgage on a non‑warrantable condo in Denver?
- Often yes, through portfolio or jumbo products, and sometimes FHA or VA if the project is approved by those programs, though pricing and requirements will differ from conforming loans.
Does HOA litigation automatically make a project non‑warrantable?
- Significant litigation, especially around structural issues or association finances, commonly leads to agency denials, but the impact depends on the case details and insurance coverage.
How long does a condo project review take in Denver?
- Timelines vary from several days to a few weeks, so start early and build review time into your contract deadlines.
Which Denver buildings are more likely to be non‑warrantable?
- Conversions, mixed‑use projects with sizable commercial space, buildings with many investor‑owned or short‑term rental units, and properties with litigation or underfunded reserves are more at risk.
