Fannie Mae & Freddie Mac Condo Requirements 2026 — Complete Guide for Title Companies

Why Condo Requirements Matter for Title Companies

When a condo project does not meet Fannie Mae or Freddie Mac requirements, the buyer cannot get a conventional loan. The transaction either falls through or requires a switch to FHA, VA, or portfolio lending. Title companies are often the first to discover compliance issues because they order the HOA documents that reveal them.

The 2026 update to Fannie Mae's Selling Guide introduced several changes, including tighter insurance requirements and expanded project review categories. Freddie Mac followed with similar updates to its Seller/Server Guide. Title companies that understand these requirements can flag issues early, educate their lender and Realtor clients, and keep transactions on track.

In 2025, approximately 28 percent of all condo transactions faced a delay related to project approval or HOA document compliance, according to a survey of title and escrow professionals. Most of those delays were avoidable with earlier document ordering and review.

Fannie Mae Condo Requirements 2026

Fannie Mae's condo project requirements are outlined in Selling Guide B4-2.1. The key requirements for 2026 include:

Project Eligibility

• Legal existence. The project must be legal under applicable state law, with valid governing documents (CC&Rs, bylaws).
• Owner-occupancy. At least 50 percent of units must be owner-occupied. Some projects qualify with 35 percent under certain conditions.
• Single entity concentration. No single entity may own more than 10 percent of units (20 percent for projects with 20 or fewer units).
• Litigation. No active litigation that affects the safety, structural soundness, or habitability of the project, or the financial viability of the HOA.
• Delinquent HOA dues. No more than 15 percent of units may be delinquent on HOA assessments by 60 days or more.

Insurance Requirements

• Property insurance. The HOA must maintain a master property insurance policy covering 100 percent of the insurable replacement cost.
• Fidelity insurance. Required if the HOA has 20 or more units and has control over reserve funds. Coverage must equal at least three months of assessments.
• Liability insurance. General liability coverage of at least $1 million per occurrence.
• Directors and officers insurance. Recommended but not required.

Review Types

Fannie Mae offers three review types in 2026:

• Full Review. Requires complete project documentation, including CC&Rs, budget, financial statements, insurance certificates, and a completed condo questionnaire.
• Limited Review. Available for projects with 10 or fewer units. Requires less documentation but still needs insurance and project eligibility verification.
• Streamlined Review. Available for projects that meet specific criteria, including certain types of attached condos and PUDs. Requires minimal documentation.

Freddie Mac Condo Requirements 2026

Freddie Mac's requirements are outlined in its Single-Family Seller/Servicer Guide, Chapter 5701. The 2026 updates include:

Project Eligibility

• Owner-occupancy. At least 50 percent owner-occupied (same as Fannie Mae).
• Single entity concentration. No single entity may own more than 10 percent of units.
• Litigation. Limited to minor non-structural litigation. Structural or safety-related litigation disqualifies the project.
• Delinquencies. No more than 15 percent of units delinquent by 30 days or more (stricter than Fannie Mae's 60-day threshold).

Insurance Requirements

• Property insurance. Same 100 percent replacement cost requirement as Fannie Mae.
• Fidelity insurance. Required for projects with 20 or more units. Coverage must equal at least three months of HOA assessments.
• Earthquake and flood insurance. Required in designated zones with specific coverage minimums.

Key Differences Between Fannie Mae and Freddie Mac

HOA Documents Needed for Condo Approval

Whether the loan will be sold to Fannie Mae or Freddie Mac, the following HOA documents are typically required for condo project approval:

• CC&Rs (Covenants, Conditions & Restrictions) — The governing documents that establish the legal framework for the project.
• Bylaws — HOA operational rules and board structure.
• Financial Statements — Most recent two years of audited or reviewed financials, including balance sheet and income statement.
• Operating Budget — Current year budget showing projected revenue and expenses.
• Reserve Study — Most recent reserve study showing the HOA's plan for major repairs and replacements.
• Insurance Certificates — Property, liability, fidelity, and D&O coverage certificates.
• Condo Questionnaire — Completed questionnaire answering specific eligibility questions from the lender.
• Resale Certificate or Estoppel Letter — Certification of the unit's fee status and any violations.

Title companies can order these documents through a professional retrieval service like HOA Docs Direct, which handles the collection and verification process.

Compliance Checklist for Title Companies

Use this checklist when reviewing a condo transaction to catch potential issues early:

1. Check project approval status. Use Fannie Mae's Condo Project Manager or Freddie Mac's Project Standards tool. Note the expiration date and review type.
2. Order HOA documents early. Order the resale certificate, CC&Rs, financials, and insurance certificates as soon as the property is identified as a condo.
3. Verify insurance coverage. Check that the master property policy covers 100 percent replacement cost and that fidelity insurance is in place for projects with 20+ units.
4. Review delinquency rates. If the resale certificate indicates high delinquency rates, flag it to the lender. Freddie Mac's 30-day threshold is tighter than Fannie Mae's.
5. Check for litigation. Any active litigation outside of normal operations should be disclosed and reviewed.
6. Confirm single entity concentration. If an investor owns multiple units, verify they do not exceed the 10 percent threshold.
7. Document everything. Maintain a file of all HOA documents received, including dates and source verification.

For a deeper dive into specific lender requirements, see our guide on Fannie Mae & Freddie Mac HOA Requirements Checklist.

Frequently Asked Questions

Key Takeaways

• Fannie Mae and Freddie Mac both require 50 percent owner-occupancy, 10 percent single entity concentration limits, and adequate insurance for condo project approval.
• Freddie Mac's delinquency threshold (30 days) is stricter than Fannie Mae's (60 days), making it easier for a project to be disqualified under Freddie Mac rules.
• The HOA documents needed for approval include CC&Rs, financials, insurance certificates, and a resale certificate or estoppel letter.
• Title companies should order HOA documents early and use the GSE project lookup tools to identify compliance issues before they delay closing.
• Professional document retrieval services can collect the full document package faster than DIY ordering, reducing the risk of last-minute surprises.