Florida condo deals fall apart over project approval more than anything else. Your buyer finds the right unit, qualifies for condo financing, and then the building fails review. That scenario costs everyone time, commission, and credibility. TAG Lending Group (NMLS #2329372), a wholesale and non-delegated correspondent lender, works with mortgage brokers, MLOs, and Realtor partners across FL, SC, TN, TX, GA, MI, NM, and OH to catch these issues before they become deal-killers.
This guide walks you through the entire Florida condo project approval process. You will learn the difference between warrantable and non-warrantable projects, how limited and full review work, what the HOA questionnaire reveals, and why Florida's post-Surfside safety laws have changed the financing landscape for every condo building in the state.
A warrantable condo is one that meets all of the eligibility requirements set by Fannie Mae or Freddie Mac. When a project is warrantable, lenders can sell the loan on the secondary market through standard agency channels. That means your buyer gets access to conventional loan terms.
A non-warrantable condo fails one or more of those requirements. Common triggers include high investor concentration, pending litigation against the HOA, excessive commercial space, delinquent HOA dues above allowable thresholds, inadequate reserves, or the project operating as a condotel. When a building is non-warrantable, conventional financing is off the table.
For your clients, the distinction is practical. Warrantable means more financing options and, typically, stronger resale value. Non-warrantable narrows the field to portfolio lenders and Non-QM programs available through select investor programs. TAG Lending Group offers non-warrantable condo financing specifically designed for projects that fall outside standard guidelines.
Agency lenders use two primary methods to evaluate a condo project: limited review and full review. The review method determines how much documentation the lender collects and how deeply it examines the project's financial and legal health.
A limited review is a streamlined process that applies to established condo projects meeting certain criteria. It requires less documentation and focuses on confirming the basics: the project is complete, the HOA is functional, insurance coverage is adequate, and no disqualifying characteristics exist. Limited review has historically been the faster path to closing for condos in stable, well-established buildings.
Note that agency guidelines around limited review are evolving. Regulatory changes may tighten or eliminate the limited review pathway for certain transactions. Staying current on lender letters and bulletins from the agencies is critical for anyone originating condo loans in Florida.
A full review is a comprehensive evaluation of the entire condo project. The lender reviews the HOA's budget, reserve funding, insurance, legal documents, litigation status, owner-occupancy ratios, investor concentration, commercial space allocation, and delinquency rates. Full review applies to all new construction projects, newly converted projects, and attached condo units in projects that do not qualify for limited review.
In Florida, full review has become the standard path for most attached condo transactions. Lenders use Fannie Mae's Condo Project Manager (CPM) tool to document and track the approval, and the approval has an expiration period. If the approval expires before closing, the lender must re-review the project.
The HOA questionnaire, often Fannie Mae Form 1076, is the primary document lenders use to evaluate a condo project. The HOA or its management company completes it, and the answers determine whether the project passes review. Every mortgage broker and loan officer originating condo deals should understand what this form covers.
The questionnaire collects data on project completion status, phasing, common element ownership, commercial space allocation, rental restrictions, pending or anticipated litigation, special assessments, HOA budget details, reserve funding levels, delinquency rates, insurance coverage, and whether the project operates with any hotel, motel, or resort characteristics.
Each answer maps directly to an agency eligibility requirement. A single problematic answer, such as pending structural litigation or reserves below the required threshold, can shift a project from warrantable to non-warrantable. This is why ordering the questionnaire early and reviewing it carefully is a non-negotiable step in any condo loan scenario.
Agency guidelines require the HOA to allocate a minimum percentage of its annual budget to replacement reserves. These reserves fund major repairs and replacements such as roofing, elevators, plumbing, and structural components. A project with underfunded reserves is a financing risk because the association may need to levy special assessments to cover unexpected costs.
Lenders evaluate whether the HOA's budget dedicates sufficient funds to reserves. The specific thresholds vary by agency and are subject to change. If the association has recently completed a reserve study showing adequate funding and a clear plan for capital expenditures, the project is in a stronger position.
In Florida, the reserve conversation has intensified because of the Structural Integrity Reserve Study (SIRS) requirement. Associations must now fund reserves for structural components based on the findings of a professional study. Associations that waive or reduce reserve funding for SIRS-required components face scrutiny from lenders and may fall out of eligibility for conventional financing.
The collapse of Champlain Towers South in Surfside in June 2021 led Florida to pass Senate Bill 4-D in 2022, followed by SB 154 in 2023 and additional legislation in subsequent years. These laws fundamentally changed the inspection and reserve requirements for condominiums and cooperatives across the state.
A milestone inspection is a structural evaluation of a condo building performed by a licensed architect or engineer. Florida law requires milestone inspections for all residential condo and cooperative buildings that are three or more stories tall. The Florida Division of Condominiums maintains detailed guidance on milestone inspection requirements and timelines. The inspection is required when the building reaches 30 years of age, or 25 years if the local enforcement agency determines that local circumstances require the earlier timeline. After the initial inspection, the building must be re-inspected every 10 years.
The inspection has two phases. Phase one is a visual examination of the building's structural components to identify signs of substantial structural deterioration. If the inspector finds evidence of deterioration in phase one, phase two involves more detailed testing to determine the scope and severity of the issue.
A SIRS is a detailed reserve study focused on the structural components of the building. It is separate from a standard reserve study and must be performed by a qualified professional. The study evaluates the remaining useful life and replacement cost of structural elements such as the roof, load-bearing walls, floor systems, foundation, plumbing, electrical, waterproofing, and exterior painting.
Associations are required to fund reserves based on the SIRS findings. A building that has not completed its SIRS, or that has completed the study but is not funding the reserves accordingly, creates a red flag for lenders reviewing the project for financing eligibility.
For mortgage brokers and Realtors, the practical impact is straightforward. Before writing an offer on a Florida condo, you need to confirm that the building has completed its required milestone inspection and SIRS, and that the association is funding reserves in compliance with the study's findings. If any of these elements are missing or incomplete, conventional financing may not be available.
TAG Lending Group helps partners navigate these requirements by reviewing project documentation and identifying potential issues early in the process. When a building does not meet conventional guidelines because of inspection or reserve gaps, TAG can evaluate the scenario for non-warrantable condo or other programs available through select investor programs.
Pending or anticipated litigation against the HOA is one of the most common reasons a condo project fails review. Lenders evaluate litigation to determine whether it poses a financial risk to the association or could affect the safety, structural soundness, or habitability of the building.
Not all litigation is disqualifying. Minor disputes, such as a slip-and-fall claim covered by insurance, typically do not affect eligibility. The concern arises with litigation involving structural defects, construction quality, water intrusion, building code violations, or financial claims that could deplete the association's reserves or trigger a special assessment.
Litigation involving the developer during the warranty period may also be evaluated differently than litigation brought by unit owners or third parties after the developer has turned over control to the association. Each lender and investor may interpret litigation risk differently, which is why having a lending partner who understands condo project review is essential.
Agency guidelines set limits on how many units in a project can be owned by a single entity or by investors (non-owner-occupants) collectively. When investor concentration exceeds the allowable threshold, the project becomes non-warrantable for conventional financing.
High investor concentration signals risk because investor-owned units tend to have higher turnover, more deferred maintenance, and less engagement with HOA governance. These factors can erode the financial stability and marketability of the project over time.
In South Florida, investor concentration is a frequent issue. Many buildings were marketed to investors during construction, and the resulting ownership mix exceeds conventional guidelines. If your buyer is looking at a high-investor-concentration building, a DSCR program or non-warrantable condo program through TAG Lending Group may provide a path to closing.
Condo projects with commercial or non-residential space on the ground floor or lower levels are common throughout Florida, especially in urban markets like Miami, Fort Lauderdale, and Tampa. Agency guidelines limit the percentage of total project space that can be used for commercial purposes. When commercial space exceeds the allowable threshold, the project becomes ineligible for conventional financing.
The commercial space calculation typically includes retail storefronts, restaurants, offices, medical facilities, and any other non-residential use. Common areas such as lobbies, parking garages, and fitness centers are generally excluded from the calculation. When evaluating a mixed-use building, confirm the commercial space percentage from the HOA questionnaire before submitting the loan.
A condotel is a condominium project that operates with hotel or resort characteristics. Units may be part of a mandatory or voluntary rental pool, managed by a hotel operator, or subject to restrictions on the owner's ability to occupy the unit year-round. Condotels are common along Florida's coastlines and in tourist-heavy markets.
Condotels are ineligible for conventional agency financing. They require specialized lending programs. TAG Lending Group offers condotel financing through select investor programs with flexible qualification options, including Full Doc, Bank Statement, and DSCR programs for owner-occupied, second home, and investment properties.
If your client is interested in a condotel unit, confirm the project's operating structure before proceeding. The rental pool arrangement, management agreement, and any owner-occupancy restrictions will determine which financing programs apply.
The fastest way to avoid a financing surprise is to verify the project's status before your buyer goes under contract. Here is a step-by-step approach that mortgage brokers and Realtors can use on every condo transaction.
TAG Lending Group maintains an approved condo list that partners can search to check whether a building has already been reviewed and approved. Starting here saves time because an already-approved project can move straight to underwriting without a new project review.
Request Fannie Mae Form 1076 from the HOA or management company as soon as the buyer identifies a target property. This document takes time to complete, and ordering it early prevents delays after the contract is executed.
For buildings subject to Florida's milestone inspection and SIRS requirements, request copies of the most recent inspection report and the current SIRS. Confirm that the association is funding reserves according to the study. If the inspection revealed structural issues, find out whether repairs have been completed or are scheduled.
Review the HOA questionnaire answers for litigation, investor concentration, and commercial space allocation. If any of these exceed standard guidelines, the project may still be financeable through a non-warrantable condo program or other portfolio option. Tag your lending partner early so the right program can be identified before the inspection period expires.
Package the HOA questionnaire, inspection reports, reserve study, and any litigation documentation, and submit the full scenario to your lender. TAG Lending Group's team reviews condo project documentation and provides feedback on eligibility, program options, and any additional items needed to move forward.
FHA condo financing follows a separate approval process managed by HUD. A condo project must be on the FHA-approved list or qualify through FHA's Single Unit Approval (SUA) process for a buyer to use an FHA loan.
The FHA-approved condo list is maintained on the HUD website, and you can search it by state, city, or project name. Projects that are on the list have already been reviewed and approved for FHA lending. Projects that are not on the list may still qualify through SUA, which allows lenders to approve individual units in unapproved projects under certain conditions.
FHA approval and conventional agency approval are separate processes with different requirements. A project can be FHA-approved but non-warrantable for conventional financing, or vice versa. Always verify both statuses when your buyer's loan program depends on the property meeting specific project standards.
Florida condo project approval is not optional knowledge for anyone originating loans or selling units in the state. Every deal starts with the building, and every building has a financing profile that determines which loan programs are available. The brokers and Realtor partners who check project eligibility first, before their clients fall in love with a unit, close more deals and protect their reputations.
TAG Lending Group gives you the tools and the team to handle condo deals with confidence. Search our approved condo list, submit your condo scenario, and get a clear answer on financing options. Whether the project is warrantable, non-warrantable, or a condotel, we have programs available through select investor programs to help you get to the closing table.
A warrantable condo meets all agency eligibility requirements for conventional financing, including thresholds for reserves, investor concentration, commercial space, litigation, and insurance. TAG Lending Group helps partners verify warrantability before submitting a loan.
A condo becomes non-warrantable when it fails one or more agency requirements. Common triggers include high investor concentration, pending structural litigation, excessive commercial space, inadequate reserves, or condotel operations. Financing is still possible through non-warrantable condo programs available through select investor programs.
Florida law requires structural milestone inspections for condo buildings three stories or taller once they reach a certain age. A building that has not completed its required inspection, or that has unresolved structural findings, may not qualify for conventional financing. Confirm inspection status before writing an offer.
A SIRS evaluates the remaining useful life and replacement cost of a building's structural components. Florida associations must fund reserves based on the study's findings. TAG Lending Group reviews SIRS documentation as part of its condo project evaluation process to help partners identify financing issues early.
Yes. TAG Lending Group maintains an approved condo list that mortgage broker, MLO, and Realtor partners can search before submitting a deal. Checking the list before writing an offer helps you identify financing eligibility early and avoid surprises during underwriting.
Yes. Condotels require specialized programs because they are ineligible for conventional agency financing. TAG Lending Group offers condotel financing through select investor programs with Full Doc, Bank Statement, and DSCR qualification options for owner-occupied, second home, and investment properties.
Search the HUD-maintained FHA-approved condo list online by state, city, or project name. If the project is not on the list, FHA Single Unit Approval may still be an option. FHA approval and conventional warrantability are separate processes with different requirements.
Send your condo scenario directly to TAG Lending Group. Include the HOA questionnaire, milestone inspection report, SIRS, and any litigation documentation. Our team reviews the project and provides clear guidance on which programs apply and what additional items may be needed to close.
Related program: Explore TAG's Non-Warrantable Condo Program