Full Lender Condo Review
Submission Form and Requirements
Revised 1/25/2021
For Conventional Products to qualify, a project must meet the following criteria:
1. All new construction and new conversion projects located in Florida must be submitted to Fannie
Mae for Condominium approval known as PERS. In addition, all new conversion projects that are
non-gut rehabs also require PERS approval.
2. In order to be considered an Established project (FNMA Type S/FHLMC EST), a project must be
complete with no additional phasing, control of the project has turned over to unit owners from
Developer and 90% of the units must be conveyed (closed). Fannie Mae will consider a project as
established with less than 90% of the units sold to unit purchasers, if Developer has no more than
20% of the total units held back for rentals as long as these units fees are current and there are no
special assessments. All other projects would be classified as FNMA Type R/FHLMC New.
3. All units, common elements, and facilities within the project, or legal phase must be 100%
complete.
4. The condominium documents must comply with the Legal Guidelines for Type R/New projects. This
is determined through a review of the constituent documents.
5. For new projects, at least 50% of units in the project or subject legal phase together with all prior
legal phases, must be conveyed or under contract to principal residence or second home buyers.
6. For established condominiums, at least 50% of the total units must have been conveyed to
principal residence or second home. However, this requirement shall not apply to primary or
second home loans.
7. No single entity, other than units owned by developer still for sale, may own more than 10% of the
units for Freddie loans or 20% of the units for Fannie Loans. If a project consists of 2-4 units, no one
can own more than 1 unit, 5-20 unit projects no more than 2 units. Units that are controlled or
owned by a nonprofit entity for the purpose of affordable housing held by higher education
institution for workforce housing programs are also excluded for single entity.
8. The fidelity, hazard including confirmation of wind, liability and flood insurance requirements must
be met.
9. If the master or blanket insurance policy does not provide coverage for the interior of the unit, the
borrower will be required to obtain a “walls in” coverage policy (commonly known as HO-6
insurance policy).
10. The condominium must be well managed. No more than 15% of the unit owners can be more
than 60 days delinquent. The budget must be adequate and provides for funding of replacement
reserves for capital expenditure and deferred maintenance in the amount of at least 10% of the
budget.
11. No more than 35% of the total square footage of the project can be used for nonresidential
purposes.
12. The units in the project must be owned fee simple or if in a leasehold, the lease and any
amendments to the lease must
be provided.
13. All facilities and amenities related to the project must be owned by the unit owners or the
homeowner’s association and not subject to a lease. No mandatory club membership fees
allowed unless amenities are owned exclusively by the HOA or Master Association.
For Gold Jumbo and Emerald Jumbo, see Resource Center for program specific requirements and
submission form.
