Hi,
Most condo boards treat a buyer’s mortgage as the buyer’s problem. As of 2026 it’s the board’s problem: if your association fails Fannie and Freddie’s new standards, nobody can get a conventional loan on any unit in the building – and every owner is stuck.
This isn’t a warning about the future. The rules have already changed, and they’re already in effect. If any of this is your association, you may already be non-warrantable:
- Your reserve contribution is below the lender floor – under 10% of the budget today
- More than 15% of owners are 60+ days behind on dues
- The association is tangled up in active litigation
- Your master insurance has gaps or a lapse
- One person or entity owns a large share of the units
Here is how it actually works now:
- On March 18, 2026, Fannie Mae and Freddie Mac jointly tightened their condo rules
- Limited Review is gone. As of August 3, 2026, every condo loan goes through Full Review – a deep look at your reserves, financials, litigation, and insurance
- The reserve floor rises from 10% to 15% of your budget on January 4, 2027
- Fail any single one of their criteria and the entire building is non-warrantable – not just the unit being sold
- Non-warrantable means no conventional mortgage on any unit – buyers walk or pay cash, sales freeze, and property values fall for every owner in the building
- It’s rechecked at every new loan, so a building can lose warrantable status overnight when reserves dip, delinquencies climb, or someone files suit
The part boards miss is that this is decided by your budget and your financials, not the buyer’s. The time to fix reserves and clean up the numbers is before an owner tries to sell and their buyer’s loan gets denied – because at that point the damage is already public, and it’s every owner’s problem, not just theirs.
That is what we handle – we check your association against the full warrantability checklist, get your reserves and financials into shape to pass Full Review, and make sure your reserve study supports the funding level lenders now require, so your owners can actually sell.
Reply to this email by Friday and we will set up a free 15-minute call with one of our senior audit professionals. Send us your current budget and reserve contribution, and we will tell you whether your building would pass Full Review today – before a failed sale tells you for free.
Sincerely,
—
George Dimov, CPA
Licensed and Insured
(833) 829-1120 toll free
(212) 994-8081 Fax
www.dimovtax.com