Buying a Condo? Review the Building, Not Just the Unit | October 20, 2026

October 20, 2026 · Evergreen mortgage education

By Paul Singh, Senior Mortgage Advisor · Individual NMLS #406332

A beautiful kitchen can make a condo memorable. The association’s budget and repair plans can make it affordable—or unexpectedly expensive. Before you commit, answer two separate questions: can your household comfortably carry the costs, and does the property meet the selected lender’s requirements?

Your preapproval is only one part of the review

For loans delivered to Fannie Mae, project eligibility is distinct from the borrower’s credit review and the unit’s appraisal. The required review depends on the project and transaction; some cases qualify for a review waiver, but applicable requirements still remain. A neighboring unit’s past closing is not a promise that your loan will be approved today.

Ask your mortgage team early: “What project review applies to this address, what documents are missing, and what could affect our closing timeline?” Read more about why preapproval is not final approval.

A five-question condo checklist

1. What do the dues actually cover? Request the current amount, included services, separate charges and any announced increase. Compare the same expense categories across properties.

2. What money is set aside? Ask for the association budget, financial statements and available reserve study. A low monthly fee alone does not tell you whether future work is adequately funded.

3. What repairs are pending? Request relevant inspection or engineering reports, board minutes and the repair plan. Ask who will perform the work, how it is funded and when completion is expected.

4. Are assessments approved or under discussion? Get the purpose, your unit’s amount, payment dates and remaining balance in writing. Ask your real estate attorney or settlement professional to clarify responsibility under the contract and applicable law.

5. Do the rules fit your plans? Review occupancy, rental, pet, parking and renovation restrictions before assuming you can use the condo the way you intend.

An assessment is more than a monthly bill

For Fannie Mae financing, lenders examine current or planned special assessments and whether they address critical repairs. An assessment connected to an unresolved critical repair can make the project ineligible. Paying your individual share does not itself prove that the underlying building issue has been resolved.

Send the documents to your mortgage team instead of summarizing them as “just routine maintenance.” Ask for a clear list of unresolved questions. Do not interpret an open-house conversation as an engineering opinion or lender clearance.

Hypothetical example: the same condo, a different budget

These figures are invented for education, not a rate quote, loan offer or prediction. Assume no mortgage insurance applies in this example.

• Principal and interest: $2,200/month

• Property taxes: $400/month

• Unit-owner insurance: $100/month

• Association dues: $450/month

• Initial total: $3,150/month

Now assume a $7,200 assessment payable in 24 equal monthly installments with no interest or fees: $7,200 ÷ 24 = $300/month. A separate 10% dues increase adds $45. The revised total is $3,495/month—$345 more, before utilities, interior maintenance and savings.

If that assessment is instead due in a lump sum, the problem is timing: you need $7,200 when payment is due, not merely room for $300 in a monthly budget. Confirm the actual terms; an installment option is not guaranteed.

The CFPB recommends budgeting beyond principal and interest, including taxes, insurance, applicable mortgage insurance and association fees, while leaving room for maintenance, utilities and savings. Avoid counting the same expense twice if it is already included in dues or escrow.

Do this before your review deadline

Do: Keep one comparison sheet per condo, with columns for the amount, source document, date checked and unanswered question. Use the homebuying worksheets to organize your notes.

Avoid: Assuming a lower advertised payment means a lower total ownership cost, or waiving document-review protections without advice from your real estate and legal professionals.

For a primary or second home in NJ, NY, PA, CT, TX or FL, bring the address, intended use and association documents to a financing conversation. Program and state availability must be confirmed; this checklist is not a project approval.

Book a 15-minute condo-financing planning call with Paul.

Primary sources checked October 20, 2026

• Fannie Mae: What to Know When Buying a Condo — consumer questions and association review.

• Fannie Mae Selling Guide B4-2.1-01 — project standards; section dated August 5, 2026.

• Fannie Mae Selling Guide B4-2.1-03 — critical repairs and special assessments; section dated August 5, 2026.

• CFPB: Figure out how much you want to spend — total housing costs and budget planning.

This is evergreen education, not a newly announced rule. The Fannie Mae guidance described here is not a universal standard for every mortgage program.

Paul Singh, Senior Mortgage Advisor · Individual NMLS #406332
Petra Cephas Inc. · Company NMLS #1222300
856-503-9396 · [email protected]

Petra Cephas Inc. is a mortgage broker arranging loans through third-party lenders, not a mortgage lender. Educational information only; not legal, tax, engineering or individualized financial advice, and not a commitment to lend. All loans are subject to lender approval, borrower and property eligibility, and applicable program and state requirements. Programs, terms and availability may change. Consult qualified professionals about your circumstances. Equal Housing Opportunity.