A condominium association does not approve a Fannie Mae or Freddie Mac loan. A lender reviews the unit, borrower, project, and applicable agency standards. Still, the association’s physical condition, reserves, insurance, delinquencies, assessments, and records can materially affect that review. This guide explains Fannie Mae condo requirements in 2026 and treats Freddie Mac separately, as the agencies require.
Current through August 19, 2026. Agency guides and lender overlays change. The lender—not the association or management company—determines mortgage and project eligibility.
Why project eligibility matters
Condo mortgages expose a lender to shared risks: one building envelope, one association budget, common insurance, collective maintenance, and assessments. A financially qualified buyer may still face delays or denial if the selected loan program cannot accept the project.
No single characteristic should casually be called “unwarrantable.” Review type, loan purpose, occupancy, project age, agency status, exceptions, and lender overlays matter.
Fannie Mae’s 2026 framework
Fannie Mae’s Selling Guide requires project review under specified methods unless a waiver applies. Lenders use Condo Project Manager (CPM) for lender-delegated Full Reviews. The Condominium Project Questionnaire, Form 1076, helps collect information, but lenders may obtain equivalent documentation.
Fannie Mae focuses on critical repairs, evacuation orders, significant deferred maintenance, inspection requirements, financial condition, litigation, ownership and use characteristics, insurance, and other project risks. Its Condo Status Finder reported in 2025 that insufficient master property insurance and critical-repair issues were leading reasons for ineligible statuses.
Fannie Mae Lender Letter LL-2026-03
Published March 18, 2026, LL-2026-03 made several material changes:
- Expanded Waiver of Project Review availability to certain projects with 10 or fewer units, subject to stated conditions; lenders could use the change immediately.
- Retired the Florida-specific requirement that new or newly converted attached projects use PERS; eligible projects may use lender-delegated Full Review. Effective immediately.
- Retired the established-project investor concentration limit for investor loans, while preserving applicable new-project presale requirements. Effective immediately.
- Announced retirement of Limited Review. Fannie Mae’s March FAQ states Florida geographic LTV restrictions continue for loan applications before August 3, 2026.
- Revised reserve standards for applications on or after August 3, 2026. When a lender uses a reserve study as an exception to the budget reserve requirement, baseline funding cannot establish adequacy, and the highest recommendation applies when multiple methods are presented.
Fannie Mae’s standard Full Review budget test generally looks for replacement-reserve allocation of at least 10% of annual budgeted assessment income, subject to current guide definitions and reserve-study alternatives. This is an underwriting test, not Florida’s SIRS funding formula.
Freddie Mac’s separate framework
Freddie Mac’s requirements are in Guide Chapter 5701. Lenders use Condo Project Advisor (CPA), which offers Project Assessment Requests, Project Waiver Requests, Project Certified processes, and status information. A tool finding does not assess every requirement; the Freddie Mac FAQ lists requirements lenders must still evaluate.
Freddie Mac’s May 2026 condominium fact sheet describes Exempt from Review, streamlined, established, new-project, reciprocal, and other review paths. Its 2026 guidance must be read for the specific loan.
For reserve studies used under relevant review provisions, Freddie Mac requires an inventory of major components, financial analysis, current reserve adequacy, proposed annual funding, a study or update generally dated within 36 months, an independent qualified preparer, compliance with state law, and favorable comment on project age, remaining life, structural integrity, and major-component replacement. The budget must support the study recommendation.
Freddie Mac provides potential unit-level waiver processes through CPA for categories including delinquent assessments, reserves below its standard, litigation, commercial space, and certain other conditions. A waiver is discretionary—not an association entitlement.
Issues associations should be ready to document
Critical repairs and deferred maintenance
Maintain final inspection reports, engineer letters, repair scopes, permits, contracts, schedules, invoices, and completion evidence. Do not answer “no critical repairs” merely because the board has not adopted a project. Give the lender the underlying facts and let it apply the agency definition.
Structural and mechanical inspections
Track milestone inspections, SIRS, local recertifications, fire and elevator reports, outstanding violations, and professional recommendations. Explain status precisely: inspection ordered, phase one complete, phase two underway, repair design, permitted work, or closed.
Reserves
Provide adopted budgets, year-to-date results, balance sheets, bank or ledger reserve balances, current reserve studies, and evidence that funding matches the adopted schedule. Florida SIRS compliance does not automatically establish agency eligibility, and an agency budget test does not establish Florida compliance.
Special assessments
Document purpose, total amount, per-unit allocation, due dates, amount collected, delinquencies, project status, contracts, and whether the assessment funds critical repair. Read the special assessment board guide.
Delinquencies
Agency tests vary by review method. Provide an accurate, dated report with units and aging. Do not change definitions to make a percentage appear better.
Insurance
Expect review of master property, flood where applicable, liability, fidelity/crime, deductibles, limits, and policy terms. Fannie Mae and Freddie Mac insurance requirements are detailed and may change independently of Florida law. Use the insurance renewal preparation guide.
Documents a Lender May Request From the Association
- Recorded declaration, bylaws, articles, amendments, and rules
- Current budget, balance sheet, income statement, reserve balances, and delinquency report
- Recent reserve study or SIRS and evidence of adopted funding
- Master insurance policies, declarations, endorsements, and appraisals
- Completed questionnaire or lender form
- Board and membership minutes
- Special-assessment notices, resolutions, ledgers, and project documents
- Milestone, structural, mechanical, roof, and other inspection reports
- Violations, permits, contracts, repair status, and completion letters
- Pending litigation and claim information reviewed by counsel
- Unit, commercial-space, rental, and ownership information
Set a controlled response process. Identify the requestor, confirm owner authorization where appropriate, use current source documents, redact protected information, obtain counsel input for litigation, and timestamp every response.
Why Financing Eligibility Should Matter Even to Owners Who Are Not Selling
A broader mortgage market can support unit liquidity and competitive resale. Restrictions can lengthen transactions, shrink the buyer pool, affect refinancing, and create repeated urgent document requests. More fundamentally, agency concerns often point to real governance issues—unfinished safety repairs, insufficient insurance, weak reserves, or unexplained assessments—that affect all owners.
The board should not manage solely to satisfy a mortgage agency. Its primary duties arise from Florida law and governing documents. But organized maintenance and finances tend to serve both obligations.
Board action checklist
- Assign one trained point of contact for lender requests.
- Maintain a current project fact sheet and document index.
- Resolve contradictory answers across questionnaires.
- Keep inspection and repair status evidence current.
- Reconcile reserves and assessment ledgers monthly.
- Calendar insurance renewals and appraisal updates.
- Have counsel review legal and litigation responses.
- Never promise Fannie Mae or Freddie Mac approval.
- Ask a lender which agency, guide provision, review type, and application date applies.
- Correct inaccurate agency status through the published channel.
What your board should do next
Build a lender-ready folder before a unit is under contract. Review it quarterly and after any inspection, claim, assessment, litigation event, or insurance renewal. Pair this with the Florida reserve guide and 2026 requirements pillar.
Moderne can organize association records and response workflows but does not make mortgage eligibility decisions. Explore document management or request a proposal.
Educational only; not legal, lending, underwriting, insurance, engineering, accounting, or financial advice.