A buyer can arrive with strong credit, steady income and a preapproval letter and still fail to get a conventional loan on a Miami condo, because the building doesn't qualify. Since August 3, 2026, Fannie Mae and Freddie Mac have ended the shortcut that let lenders approve most established-condo loans without closely examining the association's finances. Lenders now review the building in depth on nearly every financed purchase. A second change applies to loan applications dated on or after January 4, 2027, when the minimum share of the association's budget that must go to reserves rises from 10% to 15%.
For anyone buying or selling a resale condo with a mortgage this season, the association's budget is now part of the loan approval. A unit's price, condition and view still matter. Whether a building's budget passes review now also decides how many buyers can make an offer on it.
The Shortcut That Closed on August 3
Fannie Mae announced the change in Lender Letter LL-2026-03, dated March 18, 2026. It retired the Limited Review process and stated that established projects previously eligible for it "must now be reviewed using the Full Review process or, when applicable, the Waiver of Project Review process." Lenders could adopt the change right away but had to apply it to all loan applications dated on or after August 3, 2026. Freddie Mac made the same move on the same day in Bulletin 2026-C, retiring Streamlined Review for established condominium projects on the same application-date schedule.
Under Fannie Mae's Full Review rules, the lender has to run the project through Condo Project Manager, make its own certification, review the supporting documents and keep an unexpired certification in the loan file. The lender is also responsible for confirming that the data it entered is correct. In practice, someone at the lender now reads the association's budget, reserve position, insurance and inspection history before the loan can close.
A few kinds of property can still skip project review. Fannie Mae's waiver of project review covers detached condo units and projects of two to four units. Projects of five to 10 units can qualify only if they are not part of a larger development or master association, among other conditions. Few Miami buildings fit those limits. An attached unit in a mid-rise or tower now goes through Full Review.
Billed as a Win for Florida, and Partly One
When the change was announced in March, it was presented as relief for Florida. Rep. Byron Donalds's March 19 release described it as a win for Florida condo borrowers and owners, said they had faced a 25% down-payment burden, and said they would regain nationwide terms with down payments of 3% to 5%. The lender letter supports the narrow version of that claim. It says the change "effectively retires the remaining geographic restrictions that apply to the state of Florida." Fannie Mae's condo FAQ adds that the archived Florida loan-to-value limits still govern Limited Review loans with applications dated before August 3. Applications dated on or after that day cannot use Limited Review at all.
So the Florida-specific limits ended because the shortcut they were attached to ended, and Florida borrowers moved into the same Full Review every other state now uses. A low down payment is available only after the building clears that review. No borrower gets it automatically.
Who Gains Under Full Review
The same lender letter loosened two rules that matter in Miami. Fannie Mae retired the 50% investor-concentration limit for investor loans in established projects reviewed under Full Review. In a city where many buildings have a large share of investor owners, that limit used to rule out some buildings no matter how well they were run. The Real Deal reported that Fannie Mae also retired its mandatory PERS review for new condo projects in Florida. For new and newly converted projects, the requirement that at least 50% of units be sold or under contract to owner-occupant or second-home buyers still applies.
The rules got tougher on thin reserves. Lenders can still use a reserve study to show that a building has enough reserves even if its budget falls short of the standard allocation. Since August 3, the budget must include the study's highest recommended reserve amount, and the baseline funding method is no longer allowed. That method let the reserve balance fall close to zero as long as it never went below it.
| Since August 3, 2026 | Loan applications on or after January 4, 2027 | |
|---|---|---|
| Review path for established condos | Full Review, or a waiver for small or detached projects | Same |
| Florida geographic restrictions | Retired along with Limited Review | Same |
| Investor concentration limit in established projects | Retired | Same |
| Reserve study as a substitute | Must use the highest recommended allocation, no baseline funding | Same |
| Minimum replacement reserve in the budget | 10% of budgeted assessment income | 15% of budgeted assessment income |
A contract signed this fall falls under the right-hand column if the buyer's loan application is dated January 4 or later.
January 4 Is an Application Date
Fannie Mae is raising the required reserve allocation for capital expenditures and deferred maintenance from 10% to 15% of the annual budgeted assessment income. Lenders using Full Review must apply the new minimum "for all loan applications dated on or after Jan. 4, 2027." The rule keys to the date on the loan application. The contract date and the closing date do not trigger it.
For a reader on October 29, January 4 is about ten weeks away. A building that budgets 11% or 12% for reserves passes the current standard. The same building may fail for a buyer whose application is dated January 5, unless its budget changes or the lender can document adequacy another way.
Sellers face the same date. Many Miami associations adopt next year's budget in the fall. If a building's 2027 budget reaches the 15% threshold, financed buyers can still bid on its units after January 4. If it falls short, sales after that date may depend more heavily on buyers paying cash.
Florida law sets its own requirements alongside these. Under section 718.112 of the Florida Statutes, residential condo buildings at least three habitable stories high need a Structural Integrity Reserve Study at least every 10 years. Under section 553.899, those buildings generally need milestone inspections once they reach 30 years, which local authorities can move up to 25 years, and every 10 years after that. Fannie Mae's FAQ says lenders don't have to order a new structural inspection for every project. They must review any inspection report completed within the past three years, and a failed required safety inspection or a missing required recertification can make a project ineligible.
Where the Effect Falls in Miami
Most of Miami's top-end condo market won't feel this directly. MIAMI REALTORS reports that 82% of Miami condo sales of $1 million and up were all-cash in 2025. A cash buyer has no lender reviewing the building.
The effect is largest closer to the median. In the association's September 2026 report, Miami-Dade recorded 909 condo sales and a median sale price of $417,090. Sales between $300,000 and $400,000 rose 14.5% year over year, from 159 to 182. The same release puts the mortgage rate it tracks at 7.46% as of October 13, 2026. It also notes that only 21 of the 2,397 condominium buildings in Miami-Dade, Broward and Palm Beach counties are approved for FHA loans. With FHA available in so few buildings, most financed buyers use conventional loans, which now require Full Review.
Supply makes this matter more to sellers. Miami-Dade had 11,706 active condo and townhouse listings in September 2026, or 12.3 months of supply. With that much inventory, each financed buyer a building cannot accept is a real loss to its owners.
Speaking to South Florida Agent Magazine, Rate Mortgage president Shant Banosian summarized the change:
"Simply put, condo deals that worked in the past don't work anymore... a well-qualified buyer will run into a financing issue if the project doesn't meet the guidelines."
In The Real Deal, FirstService Residential regional president Robert Smith said purchases in older buildings still working through reserve funding or large capital projects, such as roofs, concrete restoration, hurricane windows and elevator modernization, will be harder to finance. The same piece suggested that the premium associations earn by acting early could be reflected in their prices. Smith put it plainly: "buyers now need to evaluate the financial health of the condominium association just as carefully as they evaluate the home itself."
Not everyone in the industry welcomed the timing. South Florida Agent Magazine reported that in a July 9 letter to FHFA Director Bill Pulte, the Community Home Lenders of America, Community Associations Institute and National Association of Mortgage Brokers warned that the changes could raise costs, reduce lender participation and limit financing, and asked for a delay or changes. The rules took effect on schedule.
Questions Buyers and Sellers Are Asking
Does a condo questionnaire still settle it?
Fannie Mae's FAQ describes the standardized GSE questionnaire as optional. If a lender's questionnaire doesn't provide enough information, the lender must get other evidence, or it cannot certify the project as eligible. Expect lenders to ask for documents beyond any single form.
Do new towers face the same review?
Attached units in new and newly converted projects were already subject to Full Review, so ending Limited Review doesn't change their path. The presale requirement still applies.
Does this affect a cash purchase?
These are lender requirements, so they apply only when a Fannie Mae or Freddie Mac conventional loan is involved. A seller's next buyer may still need one, though.
This post is general information, not legal, tax or financial advice. Your lender, attorney and tax advisor can confirm how these rules apply to a particular building and loan.
If you're weighing a resale condo purchase or listing before the January 4 change, Privé Advisory Group can review a building's budget, reserve position and inspection history with you before you commit. Request a Private Call.
