Important Credit Updates
Fannie Mae Condominium Project Requirements
To ensure the ongoing viability of Condominium Projects and in the wake of aging residential condominium buildings, Fannie Mae is updating the eligibility requirements of Condominium Projects containing attached units via Lender Letter 2021-14.
These changes are effective immediately and apply to new loan submissions and loans in the pipeline that close on or after November 16th, 2021.
- Projects with special assessments will require separate documentation to include the reason for the special assessment, the total amount assessed and total amount per unit, repayment, terms, documentation to support no negative impact to the financial stability, viability, condition, and marketability of the project.
- Projects must provide copies of any reports regarding deferred maintenance, and/or inspections received from a regulating or inspection agency to make repairs due to unsafe conditions. (These requirements do not apply to routine maintenance or repairs to maintain and preserve the condition of the project).
- A reserve study is no longer permitted in lieu of meeting the 10% replacement reserve requirement.
- Fannie Mae is changing the status of projects in their Condo Project Manager (CPM) to “Unavailable” when they become aware of projects that do not meet …….