Three words that decide whether your condo deal closes.
Warrantable
A condo is “warrantable” when the building (not just the unit) meets the requirements that let banks sell the loan to Fannie Mae or Freddie Mac. That backing is what makes 30-year fixed mortgages, 5% down loans, and competitive interest rates possible. Warrantable means the deal can use standard conventional financing.
Non-Warrantable
The building fails one or more of those requirements. Conventional financing (Fannie, Freddie), and often FHA and VA, will not work as written. Buyers need a different kind of loan called a non-warrantable condo loan. These are real loans, not workarounds, and we run them all the time. Down payments and rates are typically different from conventional, but the deal closes. The playbooks walk through which non-warrantable program fits which situation.
Project vs. Unit
When a lender approves a condo loan, they actually approve two things: the borrower (your finances) and the project (the whole building or HOA). A buyer with perfect credit and 20% down can still be turned down because the project fails. This is the single most overlooked part of condo financing, and the part that causes most last-minute deal failures.
The rest of this page (and the guide) assumes these three terms. If they’re clear, the rest is easy.
Selling a California condo, or buying one?
Each guide is built for what you actually need to know. Different audience, different checklist, different decisions.
The Seller’s Warrantability Checklist
What every California condo owner and listing agent needs to know before going to market. The 14-point pre-listing checklist, the 2026 rule changes that can kill your deal, SB 326 inspection status, what to do if your HOA isn’t warrantable.
Get the seller’s guide → For BuyersThe Buyer’s Condo Checklist
What to look for before you write an offer on a California condo. Red flags in the HOA, the questions to ask before you fall in love with the unit, how to read a reserve study, the financing paths if the building isn’t warrantable.
Get the buyer’s guide →Free. No payment. We’ll send the PDF to your email immediately.
A real piece you can use in the field.
The warrantability checklist
Everything Fannie Mae, Freddie Mac, FHA, and VA actually look at. In plain English.
The 2026 rule changes
Limited Review is gone. Reserves go from 10% to 15%. The $10,000-per-unit deferred maintenance rule. What it all means.
SB 326 explained
California’s balcony inspection law, the January 2025 deadline that passed, and why lenders are asking about it now.
Red flags that kill deals
Litigation. Special assessments. Investor concentration. Hotel-style operations. The patterns that turn a warrantable project unwarrantable.
Non-warrantable solutions
If the project doesn’t qualify for conventional, FHA, or VA, the playbooks walk through the specific non-warrantable loan programs we use to close these deals. Different down payments, different terms, but real loans that fund.
Free project status check
Send me your building address. I’ll check Fannie, Freddie, FHA, and VA project status and tell you where it stands.
A lot of warrantable condos last year are not warrantable today.
On March 18, 2026, Fannie Mae issued Lender Letter LL-2026-03 and Freddie Mac issued a matching bulletin. The changes come on a timeline:
- Now through August 2, 2026: Transition period. Lenders may apply the new rules early. Many already are.
- August 3, 2026: Limited Review is gone. Every loan in a project with more than ten units requires Full Review.
- January 4, 2027: Reserve funding minimum rises from 10% to 15% of the HOA’s annual budget.
- Already in effect: If a project has identified critical repairs over $10,000 per unit without funding allocated, the project is ineligible for conventional financing.
For a small percentage of very small projects (ten units or fewer), a new Waiver of Project Review pathway is now available, which is good news for some smaller LA condo conversions.
In California, that’s stacked on top of SB 326. The Davis-Stirling Act required condo associations to inspect exterior elevated elements (balconies, decks, walkways, stairways supported by wood) by January 1, 2025, with re-inspections every nine years after that. The 2025 deadline has now passed by more than a year, and it was never extended for condos (the AB 2579 extension only applied to apartments, not condos). Many California associations still have not completed their first inspection. Lenders are increasingly flagging this on condo project questionnaires, and a missing or expired SB 326 inspection can stall a loan.
The math is simple. A buyer can be perfectly qualified, the unit can be beautiful, the price can be right, and the deal still dies because of something at the project level that nobody flagged before listing. That’s what these guides are built to prevent.
And when a building is genuinely non-warrantable (an older HOA with thin reserves, a project with pending litigation, a building with too much commercial space, a small association without a recent reserve study), the playbooks include the specific non-warrantable loan programs we use to close those deals. Knowing your building is non-warrantable is only half the answer. The other half is having a lender who knows the programs that actually work for non-warrantable condos in California. We run those constantly.
A note from Daryn
I’m a Certified Mortgage Advisor based in El Segundo. I work with California condo buyers, sellers, and agents constantly. The 2026 changes are real, and they’re going to surprise a lot of people. If you’d rather hear it directly from a lender than read it, that’s also fine. Pick a time to talk.
Before you download.
Are these new rules in effect right now? +
Some are. As of today (June 2026), we are in the transition window. Lenders are allowed to apply the new rules immediately, and many already are. The hard deadline is August 3, 2026: from that day forward, every conventional loan in a project with more than ten units requires Full Review. The 15% reserve rule follows on January 4, 2027. The critical-repair rule (projects ineligible if identified critical repairs exceed $10,000 per unit without funding) is already enforced today.
Is my building on the Fannie or Freddie approved list? +
Fannie Mae and Freddie Mac maintain project status databases (Condo Project Manager and CPM equivalent). Send me your building address and I’ll check both, plus FHA and VA project approval status. There’s no charge for this.
What if my building is non-warrantable? +
It’s not a dead end, and it’s not even unusual. There are several non-warrantable condo loan programs offered by portfolio lenders that exist specifically for these projects. Down payments and rates are typically different from conventional, but the loan is real and the deal closes. I run these constantly, and the playbooks walk through which program fits which situation. If you’re weeks from closing and just found out your building is non-warrantable, this is fixable.
Does this only apply to high-rises? +
No. The Fannie/Freddie rules apply to virtually every condo project. SB 326 in California specifically applies to condominium associations with three or more units that have wood-framed exterior elevated elements (balconies, decks, walkways). Plenty of 4-unit and 6-unit condo conversions across LA are covered.
I’m an agent. Can I share this with my sellers and clients? +
That’s exactly what the guide is built for. Send it to listing clients before they go to market, send it to buyers before they write offers. If you want to white-label or co-brand a version for your team, reach out and we can talk.
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