Fannie Mae and Freddie Mac released new guidelines in late 2021 that bring additional requirements for condominiums. The guidelines come in the wake of the collapse of the Champlain Towers South in Surfside, Florida, and apply to all condominium and cooperative projects with five or more attached units.

Lenders rely on Fannie Mae and Freddie Mac to purchase or guarantee their mortgages because it gives more liquidity for lenders, which then allows them to underwrite or fund more mortgages. Lenders need to comply with the new Fannie Mae and Freddie Mac requirements to maintain underwriting or funding the volume of mortgages.

Under the new guidelines, mortgages secured by units in condominiums in need of Critical Repairs are not eligible for sale to Freddie Mac. Projects in need of Critical Repairs remain ineligible until the required repairs and/or an engineer’s inspection report have been completed and documented.

What are lenders looking for from condominiums?

There is considerable overlap in the Fannie Mae and Freddie Mac requirements, and they have released a joint uniform lender questionnaire.

See below for a summary on both Fannie Mae and Freddie Mac’s requirements:

Significant Deferred Maintenance and Unsafe Conditions
Projects with significant deferred maintenance or unsafe conditions are not eligible until repairs are completed.

Special Assessments
Lenders must evaluate special assessments within the project to understand the reason for the special assessment, the total amount of the assessments (including repayment terms) and evaluate whether there is a negative impact to association funds to make critical repairs. The assessment must be considered in the borrower’s debt ratios.

Reserve Requirements
All condominiums and housing cooperatives must have 10% of the associations assessment income dedicated to reserves. This 10% must be clearly identifiable in the association’s budget.

Significant Deferred Maintenance
The following criteria will make a building ineligible for secured mortgages:

  • Buildings with significant deferred maintenance and unsafe conditions.

  • A full or partial evacuation of the building to complete repairs is required for more than seven days or an unknown period of time.

  • The project has deficiencies, defects, substantial damage, or deferred maintenance that is severe enough to affect the safety, soundness, structural integrity, or habitability of the improvements.

  • The improvements need substantial repairs and rehabilitation, including to many major components that would impede the safe and sound functioning of one or more of the building’s major structural or mechanical elements including, but not limited to, the foundation, roof, load bearing structures, electrical systems, HVAC, or plumbing.

  • The building has not passed or completed required inspections (by local or state law).

The following are not considered significant deferred maintenance concerns:

  • Routine maintenance

  • Improvement projects

  • Repairs isolated to a few units that do not impact the overall project

Condo Project Manager™ 
Fannie Mae and Freddie Mac have a private database only available to lenders that tracks condominiums and housing cooperative buildings that are ineligible for mortgage backing from the GSEs.

How Concierge Plus Can Help 

As stated earlier, projects in need of Critical Repairs remain ineligible until the required repairs and/or an engineer’s inspection report have been completed and documented.

Condominium associations should be immediately prepared to respond to document and information requests from lenders related to the physical condition of the project and any current or planned special assessments (such as HOA meeting minutes, engineer’s reports, reserve studies, and financials dated within 90 days of the project review date).

The most important thing to consider when it comes to keeping up and staying connected are these key questions:

  • How are you managing your preventative maintenance?
    Property Managers need to be able to track, prioritize, schedule and resolve a whole host of tasks to keep up with the proper preventative maintenance for their community. Many communities still use manual systems on paper or spreadsheets to try and keep track of all the associated tasks that come with preventative maintenance. Communities need to move away from such manual tasks and get organized to ensure they are able to keep up with all the vital routine maintenance they need.


    With our Tasks & Reminders module you can create lists of tasks that are to be completed by another staff member, and keep tab on the progress of those items. Due dates, categories, and more, can be configured per item.

  • How is your association tracking its repair issues?
    Many associations also use manual processes for tracking repair issues submitted either by staff or residents. These types of repair issues are no less vital than preventative maintenance, but also require a strong degree of clear and effective communication between the resident reporting the issue, and the staff members that are specifically responsible for those repair issues. Associations need to be able to effectively handle these requests and all the communications that inherently go along with them. As buildings age these types of requests will become more frequent and it is thus important for staff to be able to quickly and easily address these issues.


    With our Service Request feature you can respond, monitor, and communicate the status of any job with just a few clicks. You are in-the-loop every step of the way with email alerts and online notifications when a request is created, amended, or updated.

  • Are your records and documents accessible?
    Management, Board Members, and Owners alike will always need access to documents, forms, and records that are pertinent to them. Whether it be that your Board Members access to meeting minutes, or perhaps your Owners needing access to important documents, and even Property Management that needs access to maintenance records. In this time of age, community ssociations cannot afford to be reliant on an adhoc system. They need something that is Cloud Based and accessible 24/7 that your Management, Board, or Owners can access from where they are, no matter where that is.

    File Sharing IconWith our File Sharing feature you can securely store and share all of your community documents online. Board minutes, forms, by-laws, photos, and even videos can be shared with permission-based access.

  • Can your Residents stay connected?
    Just like the need to access documents, Residents in your association also need to be able to stay connected no matter where they are. Staying connected is more important these days than it has been in the past and residents want the ability to be able to stay connected with Management and each other more than ever. Being able to offer multiple channels of community communication is key to keeping your community engaged and up to date on maintenance, repair and building safety issues. 


    With our resident portal, you can represent your community and its brand professionally. You can even automatically publish content such as amenities, calendars, files, and other information you want to publicly share. No double entry of data. 

Webinar - New Freddie Mac Underwriting Guidelines

We hosted a webinar together with our friends at Katzman Chandler to help explain the updated requirements, how to meet them, and their impact on the work of community association managers and board members. Watch our webinar now!

Katzman Webinar New Freddie Mac Underwriting Guidelines Watch

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