Many people think that when buying a condo with financing, the only thing that matters is whether the buyer qualifies for the loan.
But increasingly, that is not enough.
Starting in January 2027, Fannie Mae and Freddie Mac will increase the minimum annual reserve contribution requirement from 10% to 15% for many condominium projects reviewed under their financing guidelines.
In simple terms:
👉 You can have good credit.
👉 You can have enough income.
👉 You can have the down payment.
👉 You can be fully approved.
And the loan can still run into problems if the CONDOMINIUM does not meet the requirements.
Why?
Because lenders are looking more closely at:
🏢 Condo reserves
đź“‘ Reserve studies and building-condition reports
🛡️ Master insurance policies
đź’° Association budgets
🔎 The project’s financial and supporting documentation
IF YOU’RE A BUYER:
Before falling in love with a condo, it is important to know whether the condominium can meet the requirements of the financing you plan to use.
IF YOU’RE A SELLER:
Your unit can be in excellent condition and still face financing issues if the condominium itself does not meet lender requirements. That can directly affect your pool of buyers and your sale.
IF YOU SERVE ON A CONDO BOARD:
Waiting until a transaction is already in trouble to review reserves, insurance, and documentation can be costly.
The new reality is simple:
It is not enough for the buyer to qualify. The condominium has to qualify too.
And that can affect financing options, the number of eligible buyers, time on market, and potentially resale value.
📲 Thinking about buying or selling a condo in Puerto Rico?
Understanding these requirements before entering a transaction can help you avoid major surprises.
Source: Fannie Mae & Freddie Mac Lender Letter LL-2026-03, via the Community Associations Institute (CAI) Advocacy Blog — https://advocacy.caionline.org/fannie-freddie-update031826/
