DEFINITION of 'Spot Loan'

A spot loan is a type of mortgage loan made for a borrower to purchase a single unit in a multi-unit building, such as a condo complex. Lenders sometimes require that they approve the entire building in order to approve a loan for an unit within the building. However, some lenders will make a spot loan when only the unit to be purchased has been approved by the lender, as long as the building meets certain broader requirements.


Spot loans are frequently associated with the FHA Spot Loan program. This program allowed condo buyers to obtain an FHA-insured loan on an individual unit in a building that had not been FHA approved. This program allowed borrowers to get loans on condos when they might not otherwise have qualified.

  1. Origination

  2. Direct Consolidation Loan

  3. Temporary Lender

  4. Future Advance

  5. Renegotiated Loan

  6. FHA Loan

    A mortgage issued by federally qualified lenders and insured ...
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