A Galleria or Uptown condo can show beautifully and still lose a financed buyer over the association's numbers. Since August 3, 2026, Fannie Mae and Freddie Mac no longer offer the shortcut reviews that many established towers used to qualify for conventional loans. Under the new process, the building's budget, reserves, insurance and repair history are underwritten alongside the buyer's income.
Texas sellers have an early view of how that review will go. The resale certificate a Texas condo seller must provide already covers most of what a lender now asks for. A seller who pulls it before listing gets the same information the buyer's lender will see later, while there is still time to plan around it.
What changed on August 3, and why towers have no exemption
Fannie Mae's Lender Letter LL-2026-03, dated March 18, 2026, retired the Limited Review process. Established projects that used to qualify for it must now go through Full Review or meet a waiver, and the change is mandatory for loan applications dated on or after Aug. 3, 2026. Freddie Mac retired its matching Streamlined Review on the same date in Bulletin 2026-C. Fannie Mae's August 5 Selling Guide update kept Limited Review only for qualifying loans with application dates before August 3.
For purchases, the waivers that remain apply to small or unusual projects: detached condo units, units in two- to four-unit projects, and units in five- to ten-unit projects that are not part of a larger development or master association. Certain refinances also qualify for a waiver, as covered in the FAQ below. An Uptown high-rise has far more units than that, and they are attached. So for a purchase loan in an established tower, Full Review is the path.
The trade publication National Mortgage Professional put the practical risk plainly in its July coverage of the deadline. The worry for lenders is "not necessarily that a borrower will fail to qualify," but that the association "will not be able or willing to supply the documents necessary to determine whether the project does." Most of those documents come from boards and management companies, which neither the buyer nor the seller controls.
The Texas document that already answers most of the lender's questions
In a Texas resale, the seller must give the buyer the declaration, bylaws, rules and an association-issued resale certificate before signing a contract or conveying the unit, under Texas Property Code Section 82.157. Set side by side with the Full Review standards in Fannie Mae's October 7, 2026 Selling Guide, the two documents cover much of the same ground.
| What the resale certificate discloses | What Full Review tests |
|---|---|
| Current budget and balance sheet, reserve balances | Replacement reserves of at least 10% of annual budgeted assessment income, not counting special-assessment income |
| Regular and special assessments, the seller's unpaid amounts | No more than 15% of units 60 or more days behind on regular assessments, and separately on each special assessment |
| Capital expenditures approved for the next 12 months | No unresolved critical repairs, including unfunded repairs over $10,000 per unit due within 12 months |
| Pending lawsuits and unsatisfied judgments | No pending litigation involving the association or developer over safety, structural soundness, habitability or functional use, with specified exceptions |
| Insurance coverage | A master policy covering 100% of estimated replacement cost, with a per-unit deductible of no more than $50,000 |
Some lender tests have no matching line on the certificate. For mixed-use towers, one that applies directly to Uptown is the commercial space limit. Nonresidential space can make up no more than 35% of the project or building square footage, and that count includes commercial space even when the commercial and residential owners have separate associations. There is also a single-entity ownership cap. In projects with 21 or more units, one owner holding more than 20% of the units makes the project ineligible. The guide allows a waiver for a qualifying purchase that reduces that concentration, provided the single entity holds no more than 49% of the units and is marketing units to bring its share down further.
Special assessments are examined closely. The lender has to look at what each one pays for, whether it has been approved and collected, the original and remaining balances, and the expected payoff date. Funding a critical repair through a special assessment does not make an unresolved repair eligible. A structural or mechanical inspection completed within the past three years must also be reviewed.
The certificate is easy to get. The association must provide it within 10 days of a unit owner's written request, can charge no more than $375 for it, and the certificate must be no more than three months old when it is delivered. For a seller, that means one written request, about a week and a half, and at most $375 to learn early what the buyer's lender will be reading.
January 4, 2027 lands in the middle of a fall listing
The 10% reserve standard has an end date. The same Fannie Mae lender letter raises the minimum replacement reserve to 15% of annual budgeted assessment income for Full Review loan applications dated on or after Jan. 4, 2027. Fannie Mae's August 5 announcement said the new reserve standards would be added to the Selling Guide after that date. Its October 7 announcement covered other changes and did not mention delaying the reserve date.
The date that counts is the buyer's loan application date, not the listing date. Take a hypothetical tower budgeting $1 million a year in assessment income. Today it needs at least $100,000 a year going to replacement reserves to pass this test. For a buyer whose application is dated January 4 or later, the bar is $150,000. If a unit lists in late October and the buyer applies after the holidays, the higher bar applies.
A reserve study is the other way through, with tighter terms. A lender can rely on a qualifying study only if the association's budget funds the study's highest recommended reserve allocation, and the baseline funding method is no longer accepted. In the lender letter, Fannie Mae said it had seen "a correlation between condo projects with underfunded reserves for capital expenditures and those in need of critical repairs."
Why a building's paperwork carries more weight in today's condo market
A buyer with plenty of choices has little reason to wait on a building whose documents are slow to arrive or don't add up. The Houston Association of Realtors' September 2026 market report, released October 14, counted 323 Houston-area townhome and condo closings, down 21.0% from September 2025. The median price was $209,000, down 9.1%. Active listings rose 6.9% to 3,609, and supply reached 9.3 months, up from 8.0 a year earlier. Pending sales fell 15.9% to 370. Those figures cover the whole metro area and both property types. HAR's release does not break out high-rises.
The Greater Houston Partnership's report on August 2026 data treats high-rises as a separate, selective segment. High-rise sales rose while listings fell, and with only 52 sales, the Partnership said the lower median likely reflected the mix of units sold rather than broad weakness. In a segment with so few sales, a single deal that falls through over project eligibility has an outsized effect.
New construction is on a different track. The Ritz-Carlton Residences at 2120 Post Oak, from Deiso Moss with Cleary Interests and Marriott, plans 112 residences starting at $3 million, with opening forecast for fall 2029. The Houston Chronicle reported in May that the project had about $203 million in presales, including a $30 million penthouse under contract. Full Review for new projects comes with its own presale rules. The August 3 change applied specifically to established towers, which make up most of Uptown's resale inventory.
A pre-listing sequence for Uptown condo sellers
- Request the resale certificate early. Ask in writing so the association's 10-day clock starts. Under the statute, the certificate must be no more than three months old when the buyer receives it, so time the request with your listing date in mind.
- Do the reserve math twice. Compare the budgeted reserve contribution with total budgeted assessment income at both 10% and 15%. If the building only clears 10%, the timing of your buyer's application matters.
- Ask management whether a reserve study exists and whether the budget funds its highest recommended allocation.
- Ask for the master policy's per-unit deductible and the date of the most recent structural or mechanical inspection.
- Check how quickly management responds to lender requests. A lender may not be able to rely on a questionnaire alone, and if it cannot determine eligibility, Fannie Mae treats the project as ineligible.
Buyers have rights tied to these documents too. Texas Property Code Section 82.156 addresses a purchaser's right to cancel when the required documents have not been received, and TREC's Residential Condominium Contract, Form 30-18, effective July 1, 2026, includes provisions written specifically for condominium resales. Both sides should review those terms with their own attorney.
FAQ
Does any of this apply to refinancing? Fannie Mae waives project review for qualifying Fannie-to-Fannie limited cash-out refinances at a maximum 80% loan-to-value. Freddie Mac has a comparable exemption for qualifying Freddie-owned no-cash-out refinances. Freddie still checks for critical repairs and evacuation orders on those refinances in attached projects with 11 or more units.
My building's master policy has a deductible. Is that a problem? Fannie Mae caps the per-unit deductible on a master policy at $50,000. When there is a per-unit deductible, the borrower must also carry an individual unit-owner policy.
Will every lender apply exactly these standards? The figures above come from the agency guides. Individual lenders can set stricter requirements of their own.
This post is general information, not legal, financial or lending advice. Confirm how these rules apply to your unit and loan with your lender, attorney or other qualified professional.
If you own in a Galleria or Uptown tower and are thinking about selling this season, a few minutes with your resale certificate can tell you a lot. Kelly Henderson is glad to go through your building's numbers with you before you list. Let's Connect.
