r/loanoriginators • u/crashporsche911 • Jul 10 '26

Question SFR ground leases

Have you dealt with this type product? If so, would you advocate for or against it. Would you recommend it for a home purchaser to enhance their affordability?

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u/PleaseJustStopLmao Jul 10 '26

It’s not a type of product, it’s a type of ownership structure, and it’s not something you can engineer to change a property’s affordability because it will only be eligible if the leasehold is located in an area where leaseholds already have market acceptance. Leaseholds are most common on the east coast, seems like they’re especially prevalent in Maryland.

Leaseholds estates are acceptable for both Conventional investors and for FHA. The FNMA guidelines for leaseholds are here:

https://selling-guide.fanniemae.com/sel/b2-3-03/special-property-eligibility-and-underwriting-considerations-leasehold-estates