08/01/2026
Big Changes Are Coming To Condo Financing
Here's What You Need To Know:
If you have condo buyers in your pipeline, this one's worth a close read. Fannie Mae and Freddie Mac are reworking how condo loans get approved, and the new rules could slow some deals down or, in a few cases, keep a condo from qualifying at all. Getting ahead of it now can save you a headache later.
Starting August 3, 2026, most condo loans will need the full deep-dive review instead of the quicker shortcut lenders use today.
That means the lender will look at everything, the building's budget, its reserves, insurance, inspection reports, any lawsuits, unpaid dues, and special assessments on the horizon.
Small buildings still get some relief. Ones with 10 or fewer units may skip the full review entirely, and 5 to 10 unit buildings might too, though with a few extra conditions.
Starting January 4, 2027, buildings will also need to keep 15% of their budget in reserve instead of today's 10%, or risk losing the financing status buyers need for a normal loan.
So what does this mean for buyers? When a condo deal gets delayed, it's generally the building, not the buyer. Even a buyer with perfect credit can get stuck waiting on paperwork from a slow-moving HOA. Ask early, before an offer goes in. Find out if the building has its financials, insurance, and reserve numbers ready to go, and watch for red flags like special assessments, lawsuits, or deferred repairs. If the building is close to that January 2027 deadline, ask specifically where its reserves stand today.
