|Fwd: Posts from CAI Advocacy Blog for 10/26/2021||<– Date –> <– Thread –>|
|From: Sharon Villines (sharonsharonvillines.com)|
|Date: Wed, 27 Oct 2021 08:57:06 -0700 (PDT)|
The Community Associations Institute sends regular newsletters of changes in the law that affect condos and coops. This one contains updates related to Fannie Mae’s new project requirements. Whether your project has any connection to Fannie Mae or not, the information is a good guide to best practices and knowing which way the wind is blowing. This newsletter focuses on the structural and financial stability problems that resulted in the collapse of the condominium in Surfside FL. The 10% budget reserves is totally minimal. We just finalized our budget for 2022 and 44% of our budget is savings in reserves. > Fannie Mae Releases New Project Requirements for Condominiums and Housing > Co-ops > By Dawn Bauman, CAE on Oct 26, 2021 > On Oct. 13, Fannie Mae released new project requirements for condominiums and > housing cooperatives following the partial collapse of Champlain Tower South > condominium in Surfside, Fla., in late June. The requirements, which become > effective Jan. 1, apply to loans secured by units in high-rise buildings > containing five or more attached units. > > Below are the main points to prepare community associations for the Fannie > Mae’s new requirements and subsequent requests from lenders and appraisers. > > Key Requirements > > Unsafe Conditions: Projects that have received a directive from a regulatory > authority or inspection agency to make repairs due to unsafe conditions will > be ineligible until such repairs are made. > > Significant Deferred Maintenance: Deficiencies that meet one or more of the > following criteria will make projects ineligible: > > • At least seven days of full or partial evacuation of the building is > necessary to complete repairs. > • The project has damage, deficiencies, or defects severe enough to > affect safety, soundness, or structural integrity; and/or substantial repairs > and rehabilitation are required; and/or one or more of the building’s major > structural or mechanical elements (such as the foundation, roof, load bearing > structures, plumbing, electrical system, or HVAC) are impeded. > Special Assessments: All current or new special assessments will be reviewed > for acceptability under the following criteria: > > • Reason for the special assessment. > • Assessment amount and repayment terms. > • Demonstration of no negative impact to financial stability, > viability, condition, or marketability. > Reserves Requirements: Ten percent budget reserves are required, regardless > of reserve study assessments (and in addition to any special assessments that > may be in place). > > These requirements place a heavy focus on structural and financial stability. > Documentation also is important, meaning all pertinent paperwork (appraisals, > most recent six months of condo/co-op meeting minutes, financial statements, > engineering reports, inspection reports, and reserve studies) must be > carefully maintained and available to appraisers and lenders upon request. > > You can see the full Fannie Mae requirements here: Lender Letter(LL-2021-14). > > In addition to working with Fannie Mae on educating communities about the new > requirements, CAI is engaging with management companies and attorneys to > further advise our members on this issue. Your input on developing further > guidance for condo and co-op boards is important and welcome. Please send us > a message anytime to government [at] caionline.org. > > The post Fannie Mae Releases New Project Requirements for Condominiums and > Housing Co-ops appeared first on CAI Advocacy Blog. > > > Read in browser » > www.caionline.org Sharon ---- Sharon Villines Takoma Village Cohousing, Washington DC http://www.takomavillage.org
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