Is Your Condo on Fannie Mae’s Blacklist? What You Need to Know

Imagine finding your dream condo, only to discover that getting a mortgage is nearly impossible. Or perhaps you’re a current owner trying to refinance, only to be told your building is on a blacklist—meaning lenders won’t approve conventional loans for your unit.

This is becoming a reality for increasing homeowners as more condo projects are added to Fannie Mae’s unavailable list, limiting mortgage options and affecting property values. Experts warn that even more condo associations could soon be added.

What is the Fannie Mae condo blacklist?

Fannie Mae, the government-sponsored enterprise that guarantees mortgages, maintains a list of condo and co-op projects that fail to meet its lending criteria. Properties on this list are ineligible for conventional loans backed by Fannie Mae, which significantly reduces financing options for buyers and owners looking to refinance.

Condo developments may be blacklisted for several reasons, including:

• Structural or safety concerns that remain unaddressed
• Insufficient reserves to cover maintenance and repairs
• Pending litigation that could pose financial risks
• High investor ownership, making the property less appealing to lenders
• Insurance issues that fail to meet Fannie Mae’s requirements

Once a condo is on the list, obtaining financing through traditional lenders becomes extremely difficult, often forcing buyers into cash-only purchases or high-interest alternative loans.

Why more condos could be added soon

Industry experts warn that more condo developments could be blacklisted in the near future due to increasing scrutiny over building safety and financial stability. Since the Surfside condo collapse, regulators have intensified oversight of aging buildings, requiring stricter financial and structural assessments.

Several factors contribute to the growing number of blacklisted condos:

• Tighter reserve fund requirements – Fannie Mae now requires condo associations to allocate adequate reserves for maintenance, making some financially strapped associations ineligible.
• Rising insurance costs – Many condo buildings face higher premiums or reduced coverage, causing them to fall short of lending requirements.
• Deferred maintenance issues – Older buildings with unresolved maintenance problems risk being flagged.
• Increased litigation – More legal disputes over assessments, structural concerns, and governance can trigger ineligibility.

As these standards tighten, many condo owners may find their properties suddenly ineligible for Fannie Mae-backed loans—potentially reducing demand and affecting resale values.

What can condo owners and buyers do?

For those living in or considering a condo purchase, awareness of Fannie Mae’s eligibility requirements is key. Here’s what you can do:

• Check your condo’s status – The Fannie Mae condo blacklist and eligibility tool are not publicly accessible. Homeowners and buyers should contact the condo association or lender to check a property’s status, or consult a real estate professional for updates.
• Review HOA financials – Ensure the condo association is adequately funding reserves and meeting maintenance obligations.
• Advocate for proactive maintenance – Condo boards should address structural concerns before they become red flags for lenders.
• Consider alternative financing – If your condo is blacklisted, explore non-conventional mortgage options such as portfolio loans or FHA/VA financing.

The bottom line

As Fannie Mae tightens lending criteria, more condo associations could face the consequences of financial mismanagement, structural issues, or litigation concerns.

Homeowners and prospective buyers should stay informed and proactive to avoid financing headaches.

If you’re considering purchasing a condo, now is the time to ask the right questions and ensure your investment won’t be at risk from lending restrictions.