As of August 3, 2026, Fannie Mae and Freddie Mac retired the Limited Review and Streamlined Review lending shortcuts for condo loans. Nearly every conventional loan on a Miami condo in a building with more than 10 units now requires a Full Review of the association's finances, insurance, and reserves, regardless of the buyer's credit score or down payment. The change comes from Fannie Mae Lender Letter LL-2026-03, issued March 18, 2026, with Freddie Mac issuing a matching bulletin the same day.
Overview
For years, a buyer with strong credit or a bigger down payment could get a Limited Review, a fast-track approval that skipped a deep look at the condo association itself. That shortcut is gone for loan applications dated August 3, 2026 or later. Nearly every established condo project with more than 10 units now requires Full Review, a detailed underwriting look at the association's budget, reserves, delinquency rate, litigation history, and master insurance policy. There is real relief elsewhere in the same rule change: small buildings got an expanded waiver, and a separate 50% investor-concentration cap that blocked many downtown Miami buildings from financing was also removed. The reserve funding increase from 10% to 15% is real but not yet in effect, it applies to applications dated January 4, 2027 or later.
What Is a Condo Review, and Why Does It Matter?
Before Fannie Mae or Freddie Mac will back a conventional condo loan, the lender has to confirm the condo association itself is financially sound, not just the individual buyer. That check is called a condo review, and until August 3, 2026, lenders had a choice between two paths:
- Full Review: a complete underwriting look at the association's budget, reserve study, delinquency rate, litigation history, and master insurance policy
- Limited Review (Fannie Mae) or Streamlined Review (Freddie Mac): a fast-track option that only verified basic property data and simple insurance coverage, skipping the deep financial look, available to buyers with a larger down payment, typically 10% or more on a primary residence
A separate, smaller path called a Waiver of Project Review has also existed for very small buildings, and it just got bigger. Here is how the three options compare after August 3, 2026:
| Review Type | Status After Aug 3, 2026 | What It Checks |
|---|---|---|
| Full Review | Now required for nearly all buildings over 10 units | Full financial picture: budget, reserves, delinquencies, litigation, insurance |
| Limited Review / Streamlined Review | Eliminated for applications dated Aug 3, 2026+ | Was: basic property data and simple insurance only |
| Waiver of Project Review | Expanded, available immediately | Minimal, buildings of 10 or fewer units may skip most review |
The practical effect for a Miami buyer: unless your building qualifies for the small-building waiver, your lender is now going to ask the condo association for a lot more paperwork than they would have a year ago, and an association that cannot produce clean financials can hold up or kill a loan that has nothing to do with the buyer's own qualifications.
Small Buildings Got a Break
Buried in the same rule change is real good news for smaller buildings. Fannie Mae expanded the Waiver of Project Review to cover new and established condo projects with 10 or fewer units, effective immediately. Buildings of four units or fewer qualify without restriction. Buildings of five to ten units qualify too, but only if the building is not part of a larger master association or multi-phase development. Freddie Mac applies the same structure under its Exempt from Review option.
This matters in Miami because a meaningful share of the market is smaller boutique buildings, not just 200-plus-unit towers. If your building qualifies, ask your lender directly whether it can use the waiver rather than assuming Full Review is your only path.
The Investor Cap Was Also Removed, and That Helps Miami
A separate change in the same lender letter removed the 50% investor-concentration limit on established condo projects reviewed under Full Review for investor loans. Buildings where more than half the units are non-owner-occupied had been effectively locked out of conventional financing under the old cap. Many downtown Miami and Brickell buildings, where investor ownership runs high, were directly affected by that rule. Its removal reopens conventional financing options for buildings that had been functionally unwarrantable for years, separate from and better news than the Limited Review elimination.
What's Coming Next: Reserves and Insurance
Two more changes from the same lender letter are already locked in but not yet in effect, and Miami buyers and boards should plan around both now rather than waiting.
Reserve funding minimum rises to 15%, effective January 4, 2027
The minimum reserve funding requirement rises from 10% to 15% of a building's annual budgeted assessment income for applications dated January 4, 2027 or later. An association can substitute a reserve study instead of hitting that percentage, but only if the study is less than three years old and the association is funding at the highest recommended level in that study. Baseline or bare-minimum funding no longer qualifies as a substitute. Boards that have kept dues artificially low by underfunding reserves have roughly five months from this article's publication to close that gap or risk their building losing conventional financing eligibility.
Insurance deductible cap, effective July 1, 2026
Master property insurance policies are now capped at a $50,000 per-unit deductible for applications dated July 1, 2026 or later, already in effect. Buildings carrying a higher deductible to keep premiums down may need to adjust their policy to stay warrantable.
A Florida-Specific Change Worth Knowing
Fannie Mae also retired the requirement that new or newly converted condo projects with attached units in Florida be submitted to its Project Eligibility Review Service (PERS) for a separate approval step. Those projects now go through the standard lender-delegated Full Review process instead, the same as new projects anywhere else in the country. For new Miami developments and conversions, this removes an extra layer of state-specific review that used to add time to the approval process.
What This Means for You
If you're buying
Ask early whether the building you're interested in is likely to pass a Full Review, ideally before you make an offer, not after you're under contract. A building with underfunded reserves, high delinquency, or open litigation can block your loan even if your own credit and income are excellent. If the building has 10 or fewer units, ask your lender whether it qualifies for the waiver instead.
If you're selling
Buildings that cannot produce clean financials, budgets, and reserve documentation quickly are going to see financing delays that can cost a deal. If you're on the board or know your building's financial documentation is disorganized, getting it in order now protects your building's marketability, not just the current sale.
If you're on a condo board
The January 2027 reserve increase is closer than it looks. If your reserve study still reflects baseline funding, start the conversation now about moving toward the highest recommended funding level, since that is what your building will need to keep qualifying for conventional financing once the new minimum takes effect.
Frequently Asked Questions
What is a condo review, and why does a lender need one?
A condo review is how Fannie Mae and Freddie Mac confirm a condo association is financially sound before backing a loan on a unit in that building. It checks the association's budget, reserves, delinquency rate, litigation history, and insurance, separate from the individual buyer's own qualifications.
What exactly changed on August 3, 2026?
Fannie Mae eliminated Limited Review and Freddie Mac eliminated Streamlined Review, the fast-track options that let qualified buyers skip a full look at the condo association's finances. Nearly every loan on a building with more than 10 units now requires a Full Review.
Does this affect every Miami condo building?
No. Buildings with 10 or fewer units may qualify for an expanded Waiver of Project Review instead of Full Review, available immediately. Buildings of five to ten units must not be part of a larger master association to qualify.
Is the reserve funding increase to 15% already in effect?
No. That change applies to loan applications dated January 4, 2027 or later. It is confirmed and locked in, but boards and buyers have several months to prepare before it takes effect.
Does this apply to FHA loans too?
No. This Limited Review elimination is a Fannie Mae and Freddie Mac conventional loan policy. FHA condo approval runs on its own separate list and its own separate rules.
Financing a Miami condo purchase or sale in this new lending environment? Read our conversation with a Miami condo lending specialist for a broader walkthrough of how condo financing actually works, or browse current Miami condo listings on Allioo.