What changed with Fannie Mae and Freddie Mac condo loans on August 3, 2026?

Fannie Mae and Freddie Mac both dropped the Limited Review option for most condo loans. Before this date, a buyer with a bigger down payment could often skip a deep look at the HOA's finances. Now, condo buildings with 11 or more units need Full Review on every loan. That means the lender checks the budget, reserve account, insurance, delinquent dues, and any lawsuits before approving financing. Buildings with 10 or fewer units may still get a waiver, as long as there are no active evacuation orders or urgent repairs needed.

Why did Fannie Mae and Freddie Mac make these changes?

The short answer: building safety. These updates trace back to the Surfside condo collapse in Florida, which pushed lenders to take a harder look at deferred maintenance and reserve funding nationwide. Both agencies now want proof that a building is financially and physically sound before they back a loan. That means more focus on reserve studies, structural inspections, and how much money an association actually has set aside for big repairs.

What will my condo association need to provide?

Your HOA will need to fill out the Condo Project Questionnaire, known as Fannie Mae Form 1076 or Freddie Mac Form 476. It's the same form either way. It asks about the budget, reserve balance, insurance coverage, pending litigation, and whether the building has had a reserve study in the past three years. It also asks how many owners are behind on dues and whether any special assessments are planned. A well organized management company can often turn this around in a few days. A slow one can hold up your whole closing.

How does this affect buyers in Cambridge, Arlington, Watertown, Melrose, Waltham, and Medford?

You'll likely see more paperwork and a longer timeline. Local condo markets stay competitive, so buyers can't afford surprises mid contract. Arlington condos, for example, are selling near 101% of list price with just 28 days to offer on average this year. If your dream unit sits in an older building without a current reserve study, plan for extra weeks before your lender can clear the loan. Ask your agent to request the condo questionnaire and reserve study before you even write an offer.

What should sellers do before listing a condo?

Get ahead of it. Pull the current budget, financial statements, reserve study, master insurance certificate, and recent board minutes before your listing goes live. Ask your HOA management company if they've completed a Form 1076 recently, since a fresh one saves time later. If your building doesn't have a reserve study, or the reserves are thin, be upfront with your listing agent so you can set buyer expectations early. It's a lot less stressful than finding out during someone's mortgage approval.

Will this delay my closing?

It can, especially in buildings that haven't kept their paperwork current. Missing HOA documents are one of the most common reasons condo financing gets delayed, right alongside low reserves and pending litigation. The fix is simple: start collecting documents the day you list or the day you start shopping. Buyers should ask their lender for the condo questionnaire request as soon as they're under contract, not after.

By the Numbers

The Bottom Line

These new rules mean more paperwork, but they're not something to fear. Buyers and sellers who gather HOA documents early sail through the process. Wait until the last minute, and a thin reserve account or a missing questionnaire can stall your closing for weeks. In a market where good condos in Cambridge, Arlington, Watertown, Melrose, Waltham, and Medford still move fast, being ready matters more than ever.

Frequently Asked Questions