No Tax Return Co-op Mortgage

Co-op Mortgage With Profit and Loss Statement

When you buy into a coop you purchase shares in the corporation that owns the property. All residents in the building are shareholders and they all share in the expenses and maintenance of the property. And, when you purchase a Florida Coop you purchase shares of the corporation that owns the building. So in reality you are a shareholder in the corporation, versus a typical homeowner. With a coop, each participant is a shareholder and gets to occupy a unit in the condo or housing complex. We have a profit-and-loss co-op mortgage program no tax returns are needed. 

Self-Employed Borrower – CPA/Accountant/Tax Preparer/Enrolled Agent – Income Verification

• CPA/Accountant/Tax Preparer/Enrolled Agent’s letter confirming:
• Length of relationship with borrower
• Borrower’s position/title
• Ownership percentage of company
• Business inception date, and
• Statement on good standing of the borrower’s business
• CPA/Accountant/Tax Preparer/Enrolled Agent prepared a 12-month Profit & Loss Statement (P&L) for a period ending within 90 days of closing.
• Letter and P&L must be dated and signed on the accounting firm’s letterhead evidencing the signer’s contact information, or completed using Quontic Profit & Loss and Self-Employment Letter forms. CPA/Accountant/Tax Preparer/Enrolled Agent must have a valid PTIN (preparer tax identification number). Letter and/or P&L must not contain any exculpatory language that may compromise the integrity of the information provided.
• CPA/Accountant/Tax Preparer/Enrolled Agent must have an existing relationship with the borrower for at least one (1) year or have filed the borrower’s most recent tax return. Quontic reserves the right to request additional information such as accepting a letter and P&L from a preparer with a shorter relationship history or from a preparer that did not file borrower’s
last tax return. This would be accompanied by a satisfactory explanation and supporting documentation establishing the accountant-client relationship. Examples may include but are not limited to: completing borrower’s business IRS Form 941 for the most recent quarter, review of last 12 months’ business documents to produce P&L and intent to file next year’s
returns, etc.
• Satisfactory verification of business and CPA/Accountant/Tax Preparer/Enrolled Agent validity to be completed and documented by Quontic staff. Examples of verifications would include but not be limited to:
• PTIN search https://www.ptindirectory.com/membership-certificates.cfm
• CPA verification https://cpaverify.org/ (CPA’s only)
• IRS website

Coop Reserve Requirements:

The current reserve balance meets or exceeds 2 months of the subject property’s HOA dues in reserves multiplied by all units in the project or 10% or more reserve allocation designated in the most recent budget.

Not allowed:

• NO No Tax Return Manufactured Homes
• No Structural deficiencies or pending litigation
• Incomplete construction of the subject phase
• Units without a stovetop and oven – must have both
• Homeowners Association with No reserves
• Homeowners Association limits the number of days the property can be accessed

 Questions And Answers

Q –What Cities Do you Offer No Tax Return Loans in? Florida Coop Lenders in all of Florida including  Palm Beach, Fort Lauderdale, Hallandale, Panama City, Naples, Clearwater, Gainesville, Jacksonville, Miami, Tampa, Orlando, St. Petersburg, Tallahassee, Port St. Lucie, Sarasota, Fort Myers, Daytona Beach, Sunny Isles, Bal Harbor, Aventura, Key Biscayne, juno beach, North Miami, and everywhere in Florida. 

Q – Do we approve loans in coop projects that have re-sale, age, income, or any other owner-related restrictions?

A – Florida Coop with any sort of re-sale restrictions presents a severely negative impact on the marketability of the unit in the event the borrower defaults and this becomes an REO. It is important to identify what the restrictions are to determine project warrant ability and eligibility:

• If the only restriction is the “Right of First Refusal”, this is okay and the project can still be eligible as Warrantable.
• For projects with age restrictions, such as 55-and-older communities, we will allow financing to these projects as long as:
• Borrower meets the age requirements, and;
• The project must not have any rehabilitation, medical treatment, or elder-care facilities (for example, nursing homes).
• The project will only be considered eligible as a Non-Warrantable. If both the above conditions are not met, the loan will be ineligible under all loan programs.
• For projects with income restrictions, such as low-to-moderate income (LMI), we will allow financing to these projects as long as:
• the subject unit is NOT one of the LMI or income-restricted units.
• The project will only be considered eligible as a Non-Warrantable. If the above condition is not met, the loan will be ineligible under all loan programs.
• For all other re-sale or owner-related restrictions not identified above, the loan will be deemed ineligible under all loan programs.

Q- Does Fannie Mae Buy Florida Coop loans from lenders in Florida? 
A – On the Fannie Mae it says they will fund loans in Florida but when I ask Florida mortgage lenders why they don’t make these loans they say that NO coops in Florida meet Fannie Mae’s specifications. This is why most Florida coop loans are harder to come by and funded only by private non-QM Florida mortgage lenders.