Florida Condo Project Review: How Lenders Assess Eligibility

A condo purchase depends on more than the buyer's credit and income. A Florida condo project review also examines the building's finances, insurance, condition, legal risks, and ownership profile.

That building-level review can delay financing or make a particular loan program unavailable, even when the buyer qualifies personally. Lenders apply different standards, so a project's status with one program doesn't guarantee approval under another. Here's what lenders typically examine and what a referral-only agent can communicate without promising a loan outcome.

Key Takeaways

• Lenders assess the condominium project as well as the individual borrower and unit.
• Budgets, reserves, assessment delinquencies, insurance, structural condition, inspections, litigation, and occupancy can affect eligibility.
• Fannie Mae, Freddie Mac, and FHA use different review frameworks. A building's status under one program doesn't establish its status under another.
• Florida inspection and reserve-study laws may affect the records lenders request.
• A project review is an underwriting decision, not a guarantee of financing.

What a Condo Project Review Evaluates

The building, not just the unit

A project review gives a lender information about the condominium association and shared property. The lender may request the association's budget, financial statements, insurance certificates, inspection reports, governing documents, owner-occupancy information, and details about pending litigation or assessments.

That review is separate from the borrower's qualification. A buyer can meet a lender's credit and income standards while the building still raises concerns. Likewise, a project that appears eligible doesn't mean a particular buyer or unit will qualify.

Review paths depend on the loan

Conventional loans sold to Fannie Mae and Freddie Mac follow their respective project-review processes. Fannie Mae's Full Review is one framework, and lenders can use its Condo Project Manager (CPM) tools to assess project information. Freddie Mac also has review pathways, including Streamlined Review.

FHA has a separate system. A unit generally must be in an FHA-approved project, qualify as a Site Condominium, or use Single-Unit Approval, subject to program exceptions. One agency's approval isn't a universal endorsement. The lender applies the rules for the buyer's actual loan product.

Approval Status and Loan-Program Differences

Approval is tied to a specific program

A building can be acceptable under one lender or loan program and unacceptable under another. A condo's prior approval, an agent's experience with the property, or a successful closing in the building doesn't settle the current review.

The lender also considers the specific transaction and the project information available at that time. For example, a new budget, insurance renewal, major repair, special assessment, or lawsuit can change the picture. Project status is therefore best treated as program-specific and time-sensitive .

Loan findings are not a buyer's preapproval

A buyer's preapproval focuses on their finances and estimated borrowing capacity. It doesn't necessarily mean the lender has completed its review of the condominium association. Conversely, a project review doesn't approve the buyer.

These steps may overlap during underwriting, but they answer different questions. The borrower's lender determines whether the project and the individual loan meet the applicable requirements. An agent can help gather contacts and records, but shouldn't present a project as approved without a lender's determination.

Reserves, Budgets, and Delinquencies

Reserve funding and special assessments

A lender examines whether the association collects enough money for planned repairs and future capital expenses. Under Fannie Mae's Full Review, the budget generally must allocate at least 10% to replacement reserves for capital expenditures and deferred maintenance. An acceptable reserve study may support a different approach if it meets Fannie Mae's conditions and funding reaches at least the study's recommendations.

A wholesale-lender notice reports that Fannie Mae's reserve allocation will rise from 10% to 15% for Full Reviews of applications dated on or after January 4, 2027 . That reported change is prospective as of October 2026, and lenders apply the rule in effect for the relevant application.

Freddie Mac's FAQ language is less straightforward: one answer describes a 10% reserve allocation for established and new projects, while another frames it around projects needing critical repairs. Its FAQ also says that, for reserve studies on applications received from August 3, 2026 , baseline funding cannot be used; the highest recommendation in the study applies. Because the wording differs across the FAQ, lenders determine which Freddie Mac provision governs a specific review.

Delinquent assessments affect the project

Unpaid common expenses can weaken an association's cash flow. Under Fannie Mae's Full Review, no more than 15% of units may be 60 or more days delinquent on common-expense assessments. The same limit applies separately to each special assessment.

The lender may also examine the association's budget, current expenses, and pending or recent assessments. A large special assessment can matter even when owners are paying it, because the amount, purpose, and collection record help show how the association is handling repairs and ongoing costs.

Structural Condition and Required Inspections

Florida milestone inspections

Florida generally requires a milestone inspection for condominium and cooperative buildings with three or more habitable stories by December 31 of the year they reach 30 years, measured from the certificate of occupancy. Local enforcement agencies can set the first inspection at 25 years when local conditions warrant it. Subsequent inspections generally occur every 10 years.

Transition deadlines covered buildings that reached 30 years before July 1, 2022, with inspections due by December 31, 2024. Buildings that reached 30 years on or after July 1, 2022, and before December 31, 2024, had a December 31, 2025 deadline. Florida's milestone inspection statute sets out the requirements.

A milestone inspection is distinct from a Structural Integrity Reserve Study (SIRS). Qualifying condo buildings three stories or higher generally need a SIRS at least every 10 years. Existing associations under owner control had a baseline deadline of December 31, 2024. The study addresses reserve funding for structural items; it isn't a substitute for the milestone inspection.

Lenders assess safety and repair needs

Freddie Mac's FAQ says attached condominium and cooperative projects with 11 or more units must be safe and not need critical repairs. Applicable regulatory inspections or certifications must have been passed. A recently completed inspection, dated within three years before the project review, must be obtained and reviewed. That doesn't mean every lender must commission a new inspection for every project.

Inspection findings, deferred maintenance, repair plans, and funding can all affect underwriting. The association's records help the lender understand whether a concern is resolved, funded, or still outstanding. Florida's requirements and lender review standards overlap, but they are not the same test.

Insurance Coverage and Building Risk

Lenders review the association's master insurance policy, including coverage limits, deductibles, exclusions, and whether the policy meets the relevant loan program's requirements.

For Fannie Mae, master property coverage generally must equal at least 100% of the estimated replacement cost of project improvements. Replacement-cost coverage is generally required, with an exception for roofs. The maximum per-occurrence deductible is 5% of the master policy coverage, and the maximum per-unit deductible is $50,000 .

Flood coverage has a separate calculation for properties with covered flood risk. Building coverage must equal at least the lesser of 80% of replacement cost or the maximum National Flood Insurance Program coverage available per unit. These figures come from Fannie Mae's master property insurance requirements and flood insurance requirements.

An association can have an active policy that still fails a particular program's requirements. Lenders review the actual terms rather than relying only on a certificate showing that coverage exists.

Litigation and Owner-Occupancy Profile

Lawsuits and unresolved claims

Lenders may review pending litigation, claims, and disputes involving the association or project. The issue isn't simply whether a lawsuit exists. Its subject, potential financial effect, connection to structural work, and status can shape how the lender evaluates the building.

There isn't one litigation threshold that applies to every loan program. The lender reviews the available documents under its own program rules. A buyer's agent can flag a known lawsuit, but shouldn't interpret its legal effect or promise that it won't affect financing.

Owner occupancy and rental concentration

Lenders can examine how units are occupied, including owner-occupied homes, rentals, and other ownership patterns. The applicable criteria depend on the loan program and review type, so there isn't a single occupancy percentage that can be presented as universal.

Rental concentration may also connect with project rules, insurance, financial stability, and the intended use of the buyer's unit. The lender evaluates those facts as part of the project review. An agent should avoid describing a building as eligible based on its apparent mix of residents alone.

What Buyers and Referral Agents Can Do Before an Offer

Ask about records and known issues

A buyer can ask the listing side or association for the current budget, reserve information, insurance summary, recent inspection reports, special-assessment details, and litigation disclosures. These records can help the buyer and lender identify possible review issues early.

The lender, not the agent, decides which documents are sufficient and whether the project meets the applicable program standards. A referral-only agent can help connect the buyer with a qualified local agent and lender, then keep the explanation factual. Avoid statements such as "this building is approved" unless the lender has made that determination for the relevant financing.

Make a clear referral without taking over underwriting

For a referral-only real estate agent, a useful handoff explains the buyer's needs and known property concerns without promising approval. With the buyer's consent, pass along basic contact information, timing, financing goals, and any relevant details the buyer has shared. Leave credit, loan eligibility, legal interpretation, and project approval to the lender and other professionals responsible for those decisions.

Buyers looking for local representation can use our guide to Florida condo agents who understand financing and building eligibility. The active agent can coordinate property-level questions while the lender handles project underwriting.

Florida Condo Project Review FAQ

Can a buyer be approved if the condo project isn't?

A buyer may qualify personally while the project fails the requirements for a particular loan. The lender evaluates both parts of the transaction. Another loan program may use different criteria, but eligibility depends on its own review.

Does an old approval guarantee a new loan will work?

No. Project information can change, and lenders apply the standards in effect for the relevant loan and application. Updated insurance, repairs, assessments, financial records, or litigation may affect a later review.

Do Florida's inspections automatically satisfy lender requirements?

No. State law establishes inspection and reserve-study obligations for qualifying buildings. A lender separately evaluates project safety and documentation under its loan program. Freddie Mac, for example, specifies a recent inspection review for certain projects with 11 or more units.

Conclusion

A condo project review examines the association and shared building risks, not only the buyer's finances. Reserves, delinquencies, insurance, structural condition, inspections, litigation, and occupancy can each affect the lender's decision.

Because Fannie Mae, Freddie Mac, FHA, and individual lenders use different standards, no general checklist guarantees approval. For agents working by referral, the clearest next step is to connect the buyer with an active condo agent and lender, then let those professionals determine eligibility.