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Refinancing in Hub Buildings w/ Low Owner Occupancy

Ask a Mortgage Banker... is part of Curbed University's attempts to give you the best non-boring advice on buying, selling and renting in the Hub. Our expert answerer is Brian Cavanaugh, senior mortgage banker at Residential Mortgage Services Inc. Send your questions today (anonymity guaranteed).

A reader wrote in:
I'm trying to refinance my studio apartment in Back Bay, but I was denied because the owner occupancy in the building is only 30 percent. This sounds like it is becoming a huge problem in the Boston condo market for owners trying to refinance and prospective condo buyers looking to purchase units in buildings with low owner occupancy. I would like to know your take on this issue and what options are available for condo owners like myself.

Here was Brian Cavanaugh's answer:
Lower owner occupancy in a condo association means more risk in the eyes of Fannie/Freddie. Borrowers are able to "get around this" and possibly get financing from a portfolio lender.
Historically, the rates, etc., are a bit higher with portfolio lending.
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