A Brickell condo buyer with a conventional mortgage now gets underwritten twice. Lenders review the borrower. For applications dated on or after August 3, 2026, they must also do a full review of the tower: the association's budget, its reserves, any lawsuits, its special assessments and how the units are actually used. Before that date, many established buildings could skip most of this. Now nearly every Brickell tower has to answer for it.
The delay usually shows up after an offer is signed, while the lender waits on association documents. It can also end the conventional loan altogether. If the review finds a problem, the buyer may need a different and more expensive kind of loan.
What Changed on August 3
Fannie Mae retired its "Limited Review" for established condo projects. Those projects now go through Full Review or, in narrow cases, a Waiver of Project Review. Freddie Mac retired its counterpart, "Streamlined Review," for applications received on or after the same date. The waiver covers certain projects of ten units or fewer. Brickell's towers count their units in the hundreds, so for practical purposes the waiver doesn't reach them. 1060 Brickell has 592 units, and The Club at Brickell Bay has 643.
The change mattered because the shortcut was common. The Real Deal reported that 40 percent of condos nationwide used the limited review process last year. A South Florida mortgage executive told the outlet that deals were still closing but took longer while brokers waited for associations to deliver documents. Once the documents arrived, more buildings were falling short of Fannie Mae or Freddie Mac thresholds, which pushed buyers toward non-QM lenders that typically charge higher rates.
The same rule change also removed Fannie Mae's remaining Florida geographic restrictions. It also dropped the PERS approval requirement for new Florida projects with attached units. For older resale towers, which make up much of Brickell's existing stock, the result was simple. Every financed purchase now depends on how well the building holds up to a full look.
The Questions a Full Review Asks, and Where Brickell Has Already Answered Them
The lender guides spell out what a full review checks. Several of these items have been in Brickell news this year.
| Review item | What the guide says | Where it has come up in Brickell in 2026 |
|---|---|---|
| Pending litigation | Fannie Mae makes a project ineligible when the HOA is a party to pending litigation, with listed exceptions for minor matters | 1060 Brickell's suit against its contractor; five Brickell Key associations' suit against Swire |
| Hotel-like operation | Fannie Mae treats short-term rental activity and hotel-style operation as ineligibility factors | The Club at Brickell Bay, cited by the City of Miami in October |
| Special assessments and critical repairs | Freddie Mac makes projects needing critical repairs ineligible and requires review of each special assessment's amount remaining and payoff date | 1060 Brickell's $21 million assessment; the $32.3 million Brickell Key seawall assessment |
| Assessment delinquency | No more than 15 percent of units may be 60 or more days behind on regular or special assessments | Applies to every building under Full Review |
| Commercial space | Nonresidential space is capped at 35 percent of the project or building | Relevant wherever retail, restaurants, hotels or rental apartments share the residential building |
| Single-entity ownership | One owner may hold no more than 20 percent of units in projects of 21 or more units | Relevant in towers where investors bought in bulk |
Whether a building passes depends on details that go beyond these headlines, as 1060 Brickell shows.
1060 Brickell and the Fine Print of Litigation
In October, The Real Deal reported that the 1060 Brickell association had filed suit against its repair contractor over billing and work on the project. The $21 million repair assessment imposed in 2024 remains in place. Owners have been paying it in quarterly installments, with two or three installments reportedly left. The claims have not been decided, and the case is still open.
Fannie Mae's litigation policy doesn't automatically rule out a building like this. A suit can count as minor in several cases: when the association is the plaintiff and the lender finds the financial impact insignificant, when expected damages and legal costs stay under 10 percent of funded reserves, or when the association is recovering money for repairs already completed. Construction defect suits brought by an association are not treated as minor unless the repairs are already done and the association would face no anticipated material adverse impact if it never recovers the money. Either way, the lender must document its analysis. So 1060 Brickell's eligibility depends on facts about the suit, the repair status and the reserves that a lender has to work through one file at a time. That review takes time, and for a financed buyer it falls inside the contract period.
Across the bridge, five Brickell Key associations sued Swire over a $32.3 million seawall and baywalk assessment: Brickell Key One, Brickell Key Two, Isola, Courvoisier Courts and Carbonell. The associations allege that owners were charged for property they don't own and that the required owner approval never happened. Swire denied wrongdoing, according to The Real Deal's May 26 report. No later account of the case has surfaced since that report, so its current status should come straight from each association.
The Club at Brickell Bay and the Hotel Question
On October 20, City of Miami code inspectors cited The Club at Brickell Bay, the 2005 tower at 1200 Brickell Bay Drive, for operating as an unpermitted hotel. The association was given 10 days to comply, with a code enforcement hearing tentatively set for December 9 at Miami City Hall and fines that could reach $5,000 per day, The Real Deal reported, citing the Miami Herald. The same report put the number of units converted to short-term rentals since 2020 at about 500 of 643. The citation followed an August 11 city order directing that rentals under 30 days stop. Earlier coverage gave different counts, so the latest figure is the one to use.
Two rules apply here. The City of Miami's short-term rental procedures say that when more than 25 percent of a building's units are used as transient lodging, the whole building must meet R-1 standards. Florida's statute on transient apartments uses the same 25 percent line. The lender guides look at the same activity from the financing side. Fannie Mae lists short-term rental activity and hotel-style operation among the signs of an ineligible project. Freddie Mac says short-term rentals alone may still qualify once a lender looks at the project's full circumstances. The city also expects to look more closely at other buildings. Resolution R-26-0371, adopted September 10 with Commissioner Damian Pardo among its sponsors, calls for a report on short-term lodging compliance and quarterly reports on condo buildings with repeat violations.
Half the Market Never Asks, and That Sets the Price
In September 2026, 449 of the 909 condo and townhouse closings in Miami-Dade were paid in cash, according to MIAMI REALTORS. That is 49.4 percent of existing condo sales countywide, compared with about 27 percent of home sales nationally. FHA loans are even scarcer. The same MIAMI REALTORS release cites HUD data showing only 21 of 2,397 condo buildings in Miami-Dade, Broward and Palm Beach counties approved for FHA loans.
Those countywide numbers explain why the full review affects prices. A Brickell tower that passes can sell to cash buyers and to buyers with conventional mortgages. A tower that falls short still has cash buyers, plus borrowers willing to pay non-QM rates. Fewer bidders at a given price is what moves a building's values. The South Florida mortgage executive quoted by The Real Deal described the result as a premium on "the value of the buildings that are compliant." Sellers feel it as a smaller buyer pool before any price cut shows up.
The Next Date Is January 4, 2027
The reserve standard is also getting stricter. When a building relies on a reserve study, Fannie Mae now requires lenders to confirm the budget uses the highest recommended reserve allocations. The baseline funding method, which let a reserve balance run close to zero, is no longer allowed. For loan applications dated on or after January 4, 2027, Fannie Mae's minimum reserve contribution rises from 10 percent to 15 percent. "A lot of these buildings don't have the financial capacity to increase their reserves to 15 percent," the same mortgage executive told The Real Deal. That date is about two months after this post appears. A building that passes today on its current budget may not pass next year if the budget doesn't change.
What to Request Before the Lender Does
The guides themselves list the documents a full review relies on. Buyers and sellers can request them at the start of a deal:
- The current association budget and its reserve allocation, along with any reserve study the budget relies on
- A list of current and planned special assessments, showing purpose, approval date, original amount, amount remaining and expected payoff date
- Structural and mechanical inspection reports completed within the past three years
- The association's assessment delinquency figures
- The status of any pending litigation or pre-litigation matters, such as arbitration or mediation
- Rental rules and any city correspondence about short-term rentals
This post is general information, not legal, tax or financial advice. Confirm how these rules apply to a specific purchase or sale with your lender, attorney or tax advisor.
Frequently Asked Questions
Does the August 3 change apply only to Florida condos? No. Freddie Mac describes retiring Streamlined Review for established projects in general. Florida got separate changes, including the removal of LTV limits tied to "Certified by Lender" status.
Does any lawsuit make a building ineligible? Not automatically. Fannie Mae lists exceptions for minor litigation, and the lender has to document why a case qualifies.
Is the 15 percent reserve rule in effect now? No. It applies to Fannie Mae loan applications dated on or after January 4, 2027.
If you own in a Brickell tower and want to know how its budget, assessments and litigation history affect your likely buyers before you list, Marcelo Steinmander can review the building's file with you and price your residence accordingly. Request a free home valuation to start.
