It’s a boring little questionnaire almost no buyer has heard of — and it quietly decides whether you can get a normal mortgage on a condo. Here’s how Fannie Mae’s Form 1076 works, and the handful of things that trip up “warrantability.”
It’s a boring little questionnaire almost no buyer has ever heard of — and it quietly decides whether you can get a normal mortgage on a condo. Let’s demystify the 1076 and the handful of things that trip up “warrantability.”
Here’s a scenario that plays out more often than it should. You find the perfect condo. You’re pre-approved, you’re excited, you write the offer, it gets accepted. And then, two weeks in, your lender calls with bad news: the building didn’t pass. Not your finances — the building’s. The loan’s dead, or the rate just jumped, or you suddenly need a much bigger down payment.
What happened? You ran headfirst into a piece of paper called the Fannie Mae Form 1076, and it decided your condo wasn’t “warrantable.”
Almost nobody buying a condo knows this form exists until it bites them. So let’s fix that — because understanding it up front is the difference between a smooth close and a blown-up deal.
The Form 1076 — officially the “Condominium Project Questionnaire” (Freddie Mac runs an identical one called the 476) — is a multi-page interrogation of the condo association, not of you. When you apply for a conventional mortgage on a condo, your lender sends this questionnaire to the HOA or its property manager, and someone over there has to fill it out and send it back.
Why does the lender care so much about the building? Because of how mortgages actually work. Your lender doesn’t plan to keep your loan — they sell it to Fannie Mae or Freddie Mac. And Fannie and Freddie won’t buy a condo loan unless the whole project clears their bar. So the lender has to prove the building is healthy before they’ll lend on your unit. The 1076 is how they collect that proof.
When a project passes, it’s “warrantable” — eligible for normal, conventional financing with normal down payments and normal rates. When it fails, it’s “non-warrantable,” and your options shrink to specialty “non-warrantable condo” loans that come with higher rates, bigger down payments, and fewer lenders. Same unit, wildly different deal — decided entirely by the building’s answers on this form.
Think of it this way: with a house, the bank underwrites you. With a condo, the bank underwrites you and the entire association you’re about to join. The 1076 is the association’s report card.
The questionnaire covers roughly eight areas: ownership and occupancy, the association’s finances and reserves, insurance, delinquencies, litigation, commercial space, who controls the HOA, and — since the Surfside collapse — building safety and structural condition. Each one is a place a deal can quietly die.
Let me walk you through the ones that actually trip people up, because a handful of these account for the vast majority of “sorry, it didn’t pass” phone calls.
1. Too many renters (investor concentration). This is the big one, especially for the kind of smaller, older buildings we have all over Richmond. Fannie generally wants a majority of units to be owner-occupied — historically you’re looking for something like at least 50% owner-occupancy (a cap Fannie Mae retired for established projects in 2026) for a primary-residence purchase (higher for second homes). If a building has drifted into being mostly rentals, it can flip non-warrantable. This is why a wave of investors buying up units to rent can, ironically, make it harder for the next owner-occupant to get a loan.
2. One owner (or entity) owning too many units. Related, but distinct. If a single person or company owns too large a share of the units, Fannie sees concentration risk — if that one owner gets in trouble, the whole building does. In a small building this trips easily: in a 10-unit project, one investor owning three units already puts you at 30%.
3. Delinquencies — too many owners behind on dues. The form asks what percentage of owners are past due on their HOA payments. Cross the line — generally more than 15% of units delinquent — and the project can be knocked out. It’s a health check: if a lot of owners can’t pay their dues, the association can’t pay its bills, and the building deteriorates.
4. Thin reserves and deferred maintenance. Fannie wants to see the association setting money aside for the future — as a rule of thumb, the budget should be putting at least 10% toward reserves. A building that spends every dollar it collects and banks nothing is a special assessment waiting to happen, and underwriters know it. Post-Surfside, this scrutiny has gotten far more intense — which brings us to the next one.
5. Safety and structural issues (the post-Surfside addendum). After the Surfside condo collapse in Florida, Fannie and Freddie added a whole addendum focused on structural integrity, deferred maintenance, and needed repairs. The form now asks when the building was last inspected, whether that inspection found any safety or structural problems, and whether the required repairs have been done. Unaddressed structural findings — or a known major repair the building hasn’t funded — can make a project non-warrantable until it’s resolved. This is the newest and fastest-growing category of deal-killers.
6. Litigation. If the association is involved in a lawsuit, that’s a red flag — but here’s the nuance people get wrong: not every lawsuit disqualifies a building. Minor, routine stuff (the HOA suing an owner over unpaid dues, or a slip-and-fall fully covered by insurance) is usually fine. What kills a deal is litigation involving construction defects or structural safety — exactly the stuff that suggests the building itself has expensive problems. Those can render a project non-warrantable until the case is fully resolved.
7. Too much commercial space. These mixed-use conversions are common in walkable neighborhoods — condos above a restaurant or shop. But if commercial/non-residential space exceeds Fannie’s limits (a meaningful chunk of the total square footage), the project can fall out of warrantability. The residential lender doesn’t want the building’s fate tied too tightly to a struggling business on the ground floor.
8. Developer still in control (new or newly-converted projects). In a brand-new or freshly-converted building, if the developer hasn’t yet turned control over to the owners, or too many units are still unsold, the project may not qualify for a standard review. This one hits new conversions especially — the building can be gorgeous and still not be financeable yet.
Here’s the frustrating part nobody warns you about. Sometimes the building is totally fine — and the deal still stalls because the person filling out the 1076 did it wrong.
The questionnaire is technical, and it usually lands on the desk of a busy property manager or a volunteer board member who has to pull numbers from five different places — the budget, the insurance certificate, the delinquency report, the meeting minutes. They leave a question blank, or the reserve figure on the form doesn’t match the budget they attached, and an underwriter cannot accept an incomplete or inconsistent questionnaire. Your file sits for days or weeks over what amounts to a paperwork error.
That’s why having someone on your side who’s read a hundred of these — who can look at the completed 1076 and immediately see the missing line or the mismatched number — genuinely saves deals.
If you’ve followed my writing on our historic walk-ups and converted buildings, you can already see why this hits home here. A lot of Richmond’s most charming condos live in exactly the buildings most likely to have a 1076 problem: small projects (where one investor tips the concentration math), older buildings (where reserves and structural questions loom largest), mixed-use conversions (commercial space), and fresh conversions (developer control). The character that makes these buildings special is often correlated with the very things Fannie scrutinizes hardest.
That’s not a reason to avoid them — plenty of them pass just fine, and the ones that don’t can still be bought with the right financing. It’s a reason to check warrantability early, before you’re emotionally attached and 14 days into a contract.
The 1076 is a boring form with enormous power. It’s the moment the bank stops underwriting you and starts underwriting your building — and a handful of factors (too many renters, too many delinquencies, thin reserves, structural findings, the wrong kind of lawsuit, too much commercial space, a developer still in charge) can quietly turn a dream condo into a financing nightmare.
The fix is simple: find out where the building stands before you write the offer, not after. A good agent asks about warrantability and the association’s health on day one. It’s a lot easier to walk in with your eyes open than to get that phone call two weeks before closing.
If you’re looking at a condo — especially one of our wonderful older or converted buildings — and you want someone to help you read the building’s health before you fall in love, that’s exactly what we’re here for. Reach out.
— Rick
Educational, not lending, legal, or financial advice. Fannie Mae and Freddie Mac eligibility rules and thresholds change periodically and vary by loan type and location — confirm current requirements with your lender before relying on them. Equal Housing Opportunity.
Update — August 2026: Fannie Mae’s Lender Letter LL-2026-03 changed several of the rules described above — most notably retiring the “more than 50% investor-owned” cap for established projects and raising the reserve floor from 10% to 15%. For the full breakdown of what helps Richmond condos and what hurts, see Fannie Mae just rewrote the condo rulebook.
