Mortgage Navigator • Conventional • Condos

HOA reserves

The HOA's reserve account is not just a bookkeeping issue. It is part of whether the project is financeable.

Build My Mortgage Game PlanConventional Navigator

Fannie full review

Fannie's current full-review budget standard generally requires the HOA to fund replacement reserves for capital expenditures and deferred maintenance at a level of at least 10% of annual budgeted assessment income, subject to permitted exclusions and alternative reserve-study treatment.

Freddie established condo

Freddie's current Guide generally requires at least 15% of the project budget for replacement reserves for capital expenditures and deferred maintenance, unless an acceptable reserve study is used under the Guide conditions.

Agency Difference — this could change the loan: a project with a 12% reserve allocation might satisfy Fannie's percentage test yet fail Freddie's standard percentage test unless Freddie's reserve-study alternative is available.
Could the other agency solve this? Fannie Mae and Freddie Mac are not identical. If this scenario fails under one agency, compare the other agency's current rule and AUS result before assuming conventional financing is unavailable. A lender overlay is also different from an agency prohibition.

Official guide baseline

Fannie Mae Selling Guide · Freddie Mac Seller/Servicer Guide

Condo eligibility is both loan-level and project-level. A strong borrower does not cure an ineligible project.