Here’s something we don’t say often: we have genuinely good news to share about condo financing. 

On March 18, 2026, Fannie Mae and Freddie Mac announced real changes to how they handle condo loans. If you own a condo, are thinking about buying one, or know someone who’s been trying to finance one and hitting walls, keep reading. This matters to you. 

We’re going to break it down the way we always do: no jargon, no fluff, just what you need to know. 

First, a Quick Explanation of the Problem 

Over the past couple of years, getting a condo financed here in the Seattle and Bellevue area got surprisingly complicated, and insurance was a big reason why. 

Lenders required condo buildings to carry Replacement Cost Value (RCV) roof coverage. That means if your roof needs replacing, insurance pays what it costs to put on a brand new one at today’s prices. In theory, that sounds perfectly reasonable. In practice, it became extremely expensive and, in many cases, nearly impossible to obtain. 

The result? Good buildings with good residents were getting labeled “non-warrantable,” which is lender-speak for “we won’t approve a conventional mortgage here.” That’s a problem for buyers who want in. It’s a problem for sellers who want out. And it’s a problem for owners who just want their building to hold its value. 

That’s where the new rules come in. 

The Good News: More Buildings Will Now Qualify 

Effective July 1, 2026, buildings can now use Actual Cash Value (ACV) roof coverage instead of full replacement coverage. ACV pays out what the roof is worth today, factoring in age and wear. The rest of the building still needs full replacement coverage, but this one change alone will bring a lot of previously non-warrantable buildings back into conventional financing territory. 

Two other changes are worth knowing: 

The maximum per-unit deductible is now capped at $50,000. This simplifies a rule that, frankly, used to confuse everyone, including us. The inflation guard requirement has also been removed, which was quietly driving premiums up for a lot of associations. 

The bottom line? More buildings here in Seattle, Bellevue, and across the Eastside will now qualify for conventional financing. More buyers will be able to get loans. And HOA dues tied to insurance costs may finally level off. We make no promises about what else your dues cover. 

But Here’s the Trade-Off You Should Understand 

ACV coverage is less expensive to carry. That’s good for your HOA’s monthly budget. But if your building ever actually needs a new roof, the payout will be based on the depreciated value of the old one. A ten-year-old roof isn’t worth what a new one costs, and that gap could result in a special assessment for unit owners. 

Connor puts it simply: “It’s like insuring your ten-year-old car. If it gets totaled, you’re not getting a new one. You’re getting what it was worth. Just know what you’re signing up for.” 

Is this a dealbreaker? Not necessarily. But before you assume your building is in good shape, ask your HOA board what their current coverage looks like and what their reserve plan is. Speaking of reserves… 

A New Wrinkle Starting August 2026 

Here’s where things get a little more complicated, and we want you to be prepared. 

Starting August 3, 2026, the “limited review” process for condo loans goes away entirely. Right now, up to 40% of condo loans are going through this faster, streamlined path. After August, every single condo loan will require a full project review, which means more documentation, more time, and more back-and-forth between your lender and the HOA management. 

It is manageable. But it will slow things down, and that has real implications if you’re planning to buy or sell later this year. 

Gretchen’s take: “I’ve been working through condo reviews in this market for a long time. When buyers, sellers, and their brokers come prepared, these reviews are just part of the process. What gets people into trouble is finding out about them in the middle of a transaction. So don’t wait until you’re in the middle of one to call us!” 

And Coming in 2027: Higher Reserve Requirements 

Starting January 4, 2027, Fannie Mae and Freddie Mac will require condo associations to fund their reserves at a minimum of 15% of their annual budget, up from the current 10%. 

There is an exception. If your association has a reserve study completed within the last three years and is following its highest recommended funding level, the 15% floor may not apply. 

Here’s why this matters to you right now, even though 2027 feels far away: 

• HOA dues may go up to meet the new threshold. 

• Buildings that don’t comply could lose access to conventional financing, making it harder for everyone in the building to sell. 

• Well-funded buildings with current reserve studies may not feel any impact at all. 

Do you know where your building stands? If not, find out. Talk to your HOA board. It matters more than most owners realize, and it will matter even more once these rules take effect. 

So What Should You Actually Do? 

If you already own a condo: Ask your HOA board about your reserve funding level and what your building’s current insurance looks like. If your building was previously non-warrantable, it may now qualify for conventional financing. That’s good news for your resale value. 

If you’re thinking about buying a condo: Your options may have just expanded. More buildings are becoming financeable. And that’s great news in a market like Seattle and Bellevue where condo inventory can be limited. Just plan ahead for longer timelines if you’re buying after August 2026. 

If you’re thinking about selling your condo: This is a real opportunity, especially if your building had financing challenges before. And if you’re hoping to sell this year, doing it before August’s new review requirements kick in is something worth thinking about seriously. 

If you know someone in any of the above situations: Send them this article. It is significantly easier to read than the actual Fannie Mae lender letter. We’ve read both. We’re sure. 

Gretchen has been in this market long enough to have seen a lot of rule changes come through. Some matter more than they seem, some less. These ones matter. Connor might be newer but he can explain the whole thing in under three sentences if you prefer that approach. Either way, we’d love to talk. 

Reach out before you need us! As always, I’m your go-to for all things real estate.