The Quick Read: The best program is the one whose condo review, loan-size ladder and income method fit your file, and that changes from borrower to borrower. Through select wholesale programs, self-employed owners can qualify on twelve or twenty-four months of bank deposits instead of tax returns, even when the building fails agency rules. Everything below is subject to full underwriting and is not a commitment to lend.
- A non-warrantable label describes the building, not you or your unit.
- Bank statement income is deposits, minus an expense ratio, divided by the months of statements.
- Three limits usually decide your cash: the loan-size ladder, the condo cap, and the cash-in-hand cap.
- Above $4,000,000, every file is reviewed case by case before submission.
- Bank statements are one path. DSCR and asset-based paths exist for the same building.
If you own a high-value condo in a building that big lenders keep turning down, you are in a narrow corner of the market. Few products cover it, and the ones that do each read the building differently. This guide walks through how that corner works, from the first classification to the final cash in hand.
What Does “Best” Mean for This Kind of File?
The best program for your situation is the one that accepts your building, your income method, and the size of cash you want. A program that lends generously on paper can still decline a building with the wrong problem. Judge any option on five points:
1. Condo review tolerance. Which building problems does the program accept, and which end the file?
2. Income path. Does it take personal statements, business statements, a profit-and-loss method, or assets?
3. Size ceiling. Does its ladder reach your loan amount?
4. Proceeds flexibility. Is there a cash-in-hand cap, and does cash-out count toward reserves?
5. Occupancy fit. Primary, second home and investment property each sit on their own leverage ladder.
Lendmire is a mortgage broker, not a lender. It shops multiple wholesale programs and matches your scenario to the one whose rules fit. Lenders that write this combination vary a great deal on those five points, which is why matching matters more than any single product name.
Why a Non-Warrantable Building Changes the Loan
A condo is non-warrantable when the project fails the eligibility rules of the large government-backed buyers. Fannie Mae’s ineligible-projects rules are the usual reference. They screen out hotel-style operations, projects needing critical repairs, projects with certain pending litigation, and buildings where commercial space passes 35%.
That label matters only because those buyers will not purchase loans on such units. Portfolio and wholesale non-QM programs keep their own loans and write their own project rules. They still review the building. Non-QM does not mean skipping the condo review.
One rule has loosened. Fannie Mae has retired its investor-concentration limit for established projects under full review, per a Michigan condominium law summary. The same summary notes that individual lenders may keep their own concentration caps. A building flagged only for too many investor-owned units may now be agency-eligible, or it may still be capped by a non-QM lender’s overlay. Hotel operations, litigation and critical repairs are untouched by that change.
How Underwriting Treats the File, Step by Step
Here is the sequence a file follows, from your first call to the lender’s decision.
1. Classify the purpose. Primary residence, second home or investment property. Each takes its own leverage ladder and its own rules.
2. Choose the income path. Bank statements, assets, or property rent coverage.
3. Run the income. The program sets the statement window and the expense ratio. You do not choose them.
4. Review the building. The lender asks for the condo questionnaire, HOA budget and financials, insurance certificate and any litigation disclosure. These documents show investor concentration, delinquent dues, commercial space and insurance gaps.
5. Appraise the unit. The appraiser values the individual condo and the lender sizes the loan against that value.
6. Size the cash-out. The lender applies the lowest of the ladder, the condo cap and the proceeds cap.
7. Verify reserves, credit and housing history. Then the file goes to final underwriting.
The sequence matters because the steps can fail independently. A strong borrower can still lose on step four. A strong building can still lose on step three.
How Does Bank Statement Income Work on a Cash-Out?
Qualifying income equals eligible deposits, reduced by an expense ratio, divided by the months of statements. Practitioner explainers describe the same general method. Non-income deposits such as savings transfers and loan proceeds come out first.
Across the wholesale programs we place files with, the details look like this:
- Statement window: 12 or 24 consecutive months of personal or business statements. The bank portfolio program uses 12. Transaction histories never substitute for statements.
- Business statements: the borrower needs at least 25% ownership.
- Expense ratios: a fixed 20% for a service business with no employees, 40% for one to five employees, and 50% for six or more employees or any product business. An accountant-provided ratio can replace the fixed one.
- Profit-and-loss method: capped at 80%.
- Own-business transfers: money moved from your business into your personal account counts at 100%.
Picture a consultant with no employees. Her business deposits are reduced by 20%, and the rest is averaged across the statement months. The same deposits in a product business with a larger staff would take a 50% reduction and produce far less qualifying income. Which statements you use, and how the business is classified, can change the answer by a wide margin.
Debt-to-income can run up to 50% through select programs.
Which Limit Actually Controls Your Cash?
The lowest of several limits sets your loan, and you read them in order. The loan-size ladder comes first, because the bands are loan amounts rather than purchase prices. Multiply value by leverage, find the band that loan lands in, then read that band’s cash-out cell.
| Limit | What it controls | Where it applies |
|---|---|---|
| Loan-size ladder | Maximum cash-out leverage by band | Every file |
| Property-type cap | Non-warrantable condos to 80% | Condo file |
| Condotel cap | 65% on cash-out (50% on the bank program) | Hotel-style buildings |
| Cash-in-hand cap | $1,500,000 above 60% LTV | Portfolio program |
| Credit for the leverage | Top cell needs a higher score | Each band |
The ladder differs by occupancy, and every figure is a ceiling through select wholesale programs, subject to underwriting. On a primary residence, cash-out leverage tops out at 80% through a $1,500,000 loan, then 75% from $1,500,000 to $2,000,000. It reaches 65% in the $3,000,000 to $4,000,000 range.
On an investment property, cash-out is 75% on a standard rental through a $2,000,000 loan. It then steps down to 60% in the $2,500,000 to $3,000,000 band and 55% from $3,000,000 to $4,000,000.
Past $4,000,000 the bank portfolio program takes over the ladder, and each band has its own figure. Those loans are reviewed case by case before submission. The bank program’s ladder begins above $4,000,000 and overlaps the portfolio program up to $6,000,000. The portfolio program itself stops at $6,000,000.
Credit works the same way. The score listed for a band is what that band’s top leverage needs, not a program floor. The floors are 660 on the portfolio program, 700 above the super-jumbo line, and 680 at every size on the bank program. A lower score gets a lower leverage cell inside the same band.
A Worked Illustration
Take a self-employed founder with a condo in a building flagged for investor concentration. She holds it as a rental, so it is an investment property. Say the value supports a loan in the $1,500,000 to $2,000,000 band. That band’s top cash-out cell is 75% on a standard rental, and it needs a 700 score for that leverage.
The ladder allows 75%. The non-warrantable cap is 80%, so the ladder binds. Because the leverage is above 60%, the $1,500,000 cash-in-hand cap on the portfolio program may bind next. If she wants more cash, the options are a lower-leverage structure, a different program, or an asset path.
This is a modeled scenario, not a quote. Her real answer depends on the appraisal, the building review and her credit.
Where the General Rule Breaks
The label tells you less than the reason behind it. Lenders tolerate some building problems more than others. In rough order of how readily they are accepted:
| Building issue | Typical lender attitude |
|---|---|
| High investor concentration | Often workable in non-QM |
| Heavy commercial space | Often workable, case by case |
| Delinquent dues or thin reserves | Needs documents, may restrict leverage |
| Pending litigation | Hard, depends on the claim |
| Critical repairs | Hardest, often a stop |
| Hotel-style operations | Treated as a condotel, with lower caps |
The ranking is a general pattern across the programs we see, and each program sets its own overlays. A condotel is not simply a non-warrantable condo. Condotels carry 75% on a purchase and 65% on a cash-out through select programs, and 50% on the bank program. Mislabeling a building is a common reason a file lands with the wrong lender.
Super jumbo size adds overlays on top of the condo review. Above $3,000,000 on an investment property or second home (and above $3,500,000 on a primary residence), the portfolio program asks for:
- a 700 credit floor and a clean 0x30x24 housing history;
- 48 months of seasoning after any credit event;
- U.S. citizens or permanent residents only;
- no non-occupant co-borrowers and no rural property; and
- cash-out proceeds that cannot satisfy reserves.
A building can also change status. A project that is non-warrantable today may qualify later, with no change to your unit, and the reverse also happens. If resale matters, remember that limited financing can shrink your future buyer pool.
Bank Statements, DSCR or Assets?
Your income method is a separate choice from your building problem. For the same condo, three paths may be open.
| Path | Best fit | Watch for |
|---|---|---|
| Bank statements | Strong deposits, low taxable income | Expense ratio shrinks income |
| DSCR (rent coverage) | Rental that covers its full payment | Property-based, shorter lender list |
| Assets | Large liquid balances | Primary and second homes only |
DSCR is the debt service coverage ratio, meaning monthly rent divided by the monthly debt payment. A DSCR file qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. Programs below 1.00 coverage exist through select lenders in the network, with adjusted leverage and terms. For more on that route, see Lendmire’s complete DSCR loans guide. Whether DSCR is available at your loan size depends on the program.
The asset path has two forms. An asset allowance divides liquid assets by 36, 60 or 84 months to create income, with an 80% maximum on primary and second homes. An assets-only file needs U.S. liquid assets equal to the loan plus closing costs plus sixty months of any net loss on other residential property. Retirement accounts count at 70%, or 80% at age 59.5 and up. Business funds, gifts, cryptocurrency and unvested stock never count.
Investment Versus Owner-Occupied
Investment cash-outs are business-purpose loans. Credit to acquire, improve or maintain non-owner-occupied rental property is treated as business purpose under CFPB Regulation Z, so lenders underwrite it to their own program guidelines. That exemption depends on the facts, including how often you plan to use the property yourself. An owner-occupied or second-home cash-out is a consumer loan with its own rules, so the two should never be treated as interchangeable. Each takes its own ladder in the tables above.
Reserves and Pre-Screening
Reserves are liquid funds left after closing. Through select programs they run 3 months up to $500,000, 6 months up to $1,500,000, and 9 months above that. Each additional financed property adds 2 months, to a 12-month maximum, and first-time investors need 12 months. On super jumbo overlays, cash-out proceeds cannot count toward reserves. Hold that liquidity outside the refinance.
Before you order an appraisal, pre-screen the building:
- Request the condo questionnaire, HOA budget and financials, insurance certificate and any litigation disclosure.
- Ask what share of units is investor-owned, what share is commercial, and whether dues are delinquent.
- Confirm whether short-term rental activity or hotel-style operations exist.
- Pull your last 12 or 24 statements, and sort personal and business accounts.
- Decide whether the property is a primary residence, second home or investment.
Common mistakes follow the same pattern. Borrowers assume the primary-residence ladder applies to an investment unit. They assume the label sets the limit when the ladder does. And they assume a decline means failure, when it usually means program fit. If you need the document detail, Lendmire’s guide to documents for a super jumbo bank statement cash-out covers the full list. For how large the check can get on a flagged building, see Lendmire’s piece on how much cash a super jumbo cash-out releases on a non-warrantable condo.
Tax treatment can depend on how the funds are used and how the property is held; borrowers should keep clear records and speak with a qualified tax professional before relying on any deduction.
Key Terms Defined
Non-warrantable condo: a unit in a project that fails the eligibility rules of the large conventional mortgage buyers.
Super jumbo: a loan size set by lenders rather than a regulator, which in this guide means roughly above $3,000,000 to $3,500,000 depending on occupancy.
Bank statement loan: a non-QM loan that is reviewed around documented deposits instead of tax returns, subject to lender guidelines.
Expense ratio: the share of business deposits removed to reflect operating costs before income is calculated.
Cash-in-hand cap: the limit on how much cash you can take out at closing above a stated leverage.
Condotel: a condo building run with hotel-style operations, such as a rental pool or front desk.
Frequently Asked Questions
Can I refinance a non-warrantable condo and take cash out?
Yes, through select wholesale programs, but cash-out is usually stricter than a rate-and-term refinance on these buildings. The lender reviews the building, then applies the lowest of the ladder, the 80% non-warrantable cap and any proceeds cap. Loans above $4,000,000 are reviewed case by case before submission.
Does non-warrantable mean the building is unsafe?
No. It means the project fails agency eligibility rules, and the cause can be as harmless as a high share of rentals. Litigation and critical repairs deserve more caution, because lenders treat those as true repayment risks.
Does a super jumbo lender relax condo rules?
No. Larger loans add overlays, such as a 700 credit floor and cash-out proceeds that cannot count toward reserves. Condo review stays in place and often gets tighter as the loan grows.
Is a bank statement loan the same as no underwriting?
No. Income and assets are still verified from your statements, and the lender still reviews credit, reserves and the building. The method changes which documents prove income, not whether income is checked.
Should I use bank statements or DSCR on an investment condo?
It depends on the file. Bank statements fit when your deposits are strong, and DSCR fits when the rent covers the full payment. A broker can run both and compare the outcomes.
Compare Your Options
If you are financing a high-balance property on business or personal bank statements and want to see how the numbers work, Lendmire can help you compare super jumbo bank statement loan options based on your deposits, the property, credit profile, leverage, and your goals. Lendmire’s consumer mortgage lending is licensed in AL, CA, CO, FL, GA, IN, MI, MT, NM, NC, OH, PA, TN, TX, VA and WA, and every program is subject to full underwriting.
Condo status can change as buildings settle litigation, rebuild reserves or shift ownership. A file declined today may fit a program next season, so recheck the building before you give up on the cash.
Investors weighing their equity options can start with Lendmire’s guide to cash-out refinance on an investment property.
Lendmire’s self-employed mortgages page presents both super jumbo programs, bank statement and DSCR, side by side.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage broker that arranges bank statement, P&L-only, 1099-only and asset-based home financing in 16 states through wholesale lenders, on primary residences, second homes and investment properties. Every option is subject to the lender’s guidelines and full underwriting. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. Fannie Mae Selling Guide B4-2.1-03, Ineligible Projects
2. Michigan Community Association Law Blog, Fannie Mae Condominium Lending Guidelines
3. Docsumo, Bank Statement Income Verification
4. CFPB, Regulation Z § 1026.3, Exempt Transactions
This article is part of Lendmire’s super jumbo bank statement loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Super Jumbo Bank Statement Refinance vs Hold on a Loan Under Two Years · How Much a Super Jumbo Bank Statement Refinance Costs to Close · Should a Retiree Refinance a Super Jumbo Bank Statement Loan?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Disclosures. The information presented in this article is general market commentary, not financial, legal, or tax advice. Lendmire is a mortgage brokerage (NMLS# 2371349) — not a direct lender or depository institution — and loan placement is subject to lender underwriting. Nothing in this content represents a commitment to lend. Loan terms, pricing, and program availability vary based on borrower qualifications, property characteristics, and state of subject property, and are subject to change at any time. Lendmire complies with Equal Housing Opportunity requirements. Consumer access: nmlsconsumeraccess.org.