Fannie Mae’s Temporary…

In the wake of the tragic collapse of the Champlain South Tower in Surfside, Florida, Fannie Mae has announced that it will no longer back mortgages of people trying to buy condominium and/or co-op units in certain buildings with aging infrastructure and significant deferred maintenance.  On October 13, 2021, Fannie Mae issued Temporary Requirements for Condo and Co-Op Projects, significantly impacting loans secured by units in condominium and co-ops. The temporary requirements address the structural and financial health of buildings, mandating an in-depth review of conditions regarding safety, soundness, structural integrity, or habitability to determine whether a property is eligible for a loan. While these new temporary requirements arise out of the concern for residential buildings with aging infrastructure and significant deferred maintenance, the new measures will inevitably have a chilling effect on condominium and co-op sales, as hundreds of properties will be deemed ineligible for loans.

More than ever, lenders are requiring thorough review of association records, including meeting minutes and inspection reports to obtain information about maintenance or construction that may have a significant impact on safety, soundness, structural integrity, or habitability of the property, as well as the financial strength of the association. Effective January 1, 2022, loans secured by units in condo and co-op projects with significant deferred maintenance or in projects that have received a directive from a regulatory authority or inspection agency to make repairs due to unsafe conditions are not eligible for purchase, and will remain ineligible until the required repairs have been made and documented. Fannie Mae defines “significant deferred maintenance” to include deficiencies that meet one or more of several specific criteria, visit Eisinger Law’s website at to view the entire list along with an expanded article.

Further, properties that have failed to obtain an acceptable certificate of occupancy or pass local regulatory inspections or recertifications are not eligible. Currently, in Miami-Dade and Broward Counties alone, there are hundreds of buildings that are due for their 40-year or 50-year recertification that will be affected by Fannie Mae’s temporary requirements. Indeed, in the wake of the Champlain South Tower collapse, many municipalities across Dade and Broward Counties performed building audits, cracking down on those buildings overdue for recertification. Under the new temporary requirements, owners and purchasers at these properties will be ineligible for loans.

Carolina Sznajderman Sheir is an AV Preeminent® rated attorney and partner at Eisinger Law. She focuses her practice on real estate law, community association law, commercial litigation and developer representation and can be reached at 954-894-8000 x238 or

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