We have recently received a number of calls from concerned homeowners, real estate agents, and lenders regarding a rumor that Fannie Mae and Freddie Mac will no longer lend to transactions involving Parkfairfax units.
Since then, the Parkfairfax office has been in constant contact with mortgage brokers and agents and has also spoken to Fannie Mae to learn more about the real status and its implications for Parkfairfax. We are committed to keeping you informed and involved.
Please read carefully below:
On 6/12/2024, Fannie Mae’s website changed Parkfairfax Condo Approval status from “Approved” to “Unavailable.”
Why did this happen, and what does it mean?
Since the Surfside Condominium catastrophe in Florida, Fannie Mae and Freddie Mac made significant adjustments in how they treat loans for condo-type properties. The government-sponsored enterprises updated their condominium and cooperative project eligibility standards for properties with five or more units. The new guidelines mandate a review of a property’s repair status before mortgage approval. This review covers ownership structure and composition, reserve funds, litigation, and insurance. The agencies’ updated eligibility standards also denote the difference between critical and routine repairs and the role special assessments and inspections play in the review of maintenance concerns.
During a recent review for a mortgage application on a unit in building 109, Fannie Mae was made aware that three buildings (Buildings 716,109 and 111) are undergoing major structural repairs. While Parkfairfax provided documentation proving that the structural repairs are being addressed and that the repairs applied to only three buildings out of 285, they still determined that they would change that status from “Approved” to temporarily “Unavailable” until the projects are completed, and we have provided proof that there are no other pending issues with such buildings.
From Fannie Mae’s website: If a condominium status is “Unavailable,” can lenders submit documentation to have the status re-evaluated?
If a lender has completed a review of the project and has documentation to prove the eligibility issues are resolved, they can submit it to Fannie Mae for review and possibly removal of the unavailable status. Lenders will need to complete a review of the documentation and explain why they believe the project meets Fannie Mae’s guidelines.
Does this mean buyers can’t get a loan to purchase at Parkfairfax?
No. If lenders want to offer Fannie Mae or Freddie Mac loans, they must provide documentation proving all structural repairs have been addressed. This will be possible once the foundation repairs for buildings 716, 109, and 111 are completed.
All other lenders, except for these two, still offer conventional loans and are working with other purchasers who wish to buy at Parkfairfax. Parkfairfax is also approved by government-backed FHA and VA loans and is approved until 2027, when it will be up for renewal.
When do we expect our Fannie Mae’s status to be changed back to “Approved”?
The foundation repairs on building 716 have been completed, and 111 and 109 will be completed in early to mid-August. Once completed, Parkfairfax will notify all homeowners, real estate agents, and lenders, informing them that the repairs have been completed and are backed by an updated engineer report so that they can submit their loan applications to Fannie Mae and Freddie Mac.
Parkfairfax is a well-funded and properly maintained condominium with over $7 million in reserves that routinely spends approximately $4 million annually on maintenance. We carefully rely on engineers’ and experts’ opinions when implementing maintenance programs and promptly addressing repairs.
Please share this information with everyone who wants to know more about this matter.
We will inform you of any changes if something happens before the estimated timeline.
If you have further questions, please contact the General Manager, Francisco Foschi, at ffoschi@parkfairfax.org or the Assistant General Manager, Dana Cross, at dcross@parkfairfax.org.
Parkfairfax Management.
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