Florida HOA Lawyer Blog
As my fellow firm partner Laura Manning-Hudson wrote recently in this blog, Fannie Mae’s new condo-safety financing requirements for condo buyers are now in place. Following suit, federal mortgage buyer Freddie Mac has also announced similar requirements for condominium loans to meet its standards for acquisition for its mortgage-backed securities for investors. Both of these changes are heralds of the stricter mandates that condominium associations are likely to see as a result of the horrific tragedy of the collapse of the Champlain Towers South in Surfside, Florida.
Freddie Mac’s new requirements, which take effect for all mortgages with settlement dates on or after Feb. 28, exclude from eligibility for acquisition any loans for units in condominium communities with what it considers to be critical repair needs. Subsequently, properties that have already identified elements requiring attention and begun their construction and remediation efforts may become ineligible until such repairs and renovations are completed.
The federal agency defines critical repairs as those that significantly impact a community’s safety, soundness, structural integrity or habitability, and/or that impact unit values, financial viability or marketability. These include all life-safety hazards, violations of any laws or ordinances, building code violations, fire-safety deficiencies, and others.