Tekin Works › Free tools › Condo reserves
Does the budget clear the reserve floor
on the date the application is dated?
Fannie Mae's replacement reserve requirement is a ratio between two lines of the association's own budget. On 4 January 2027 the floor goes from 10% to 15% for applications dated on or after that day — so the same budget can clear in December and fail in January. This checks both, and it checks the reserve-study route as well, because reporting a failure when that route is open is worse than reporting nothing.
The thing that makes this rule awkward
It is a budget ratio, so it can be failed by an association with money in the bank.
The requirement does not ask how much is in the reserve account. It asks what share of this year's assessment income the budget sends to reserves. So an association that spent a decade building a healthy balance and then trimmed its reserve line can fail, while an association with very little saved but a disciplined budget passes. Boards are routinely surprised by this, and the surprise usually arrives during somebody's sale.
The second surprise is the date. The floor rises to 15% for applications dated on or after 4 January 2027. An association sitting between 10% and 15% is in a position where nothing about it will change, no decision will be taken, and it will stop clearing anyway. The only difference between the December answer and the January one is which application the budget is being measured against.
That gap is worth finding in the autumn, while the budget for next year is still being written, rather than in February when it is a financing problem attached to a specific unit and a specific buyer.
The route most summaries leave out
A great deal of what is written about the 15% change describes it as a hard percentage. It is not. A current reserve study — within three years, by an independent qualified professional — whose highest recommended annual allocation is actually funded by the budget satisfies the requirement on its own, whatever the percentage says.
This matters in both directions. An association told it fails when this route is open has been given a false finding, and a false finding in compliance work is worse than no finding: it sends a board into a special assessment conversation it did not need to have. Equally, an association relying on the study route is relying on the study staying current, which is a date worth putting in the diary rather than discovering later.
The calculator above asks you whether the study qualifies instead of guessing, and if you answer no it does not quietly treat a missing study as a pass. The same rule is implemented that way in the system this page belongs to: the second route can only rescue a project, never condemn one.
What this does not do
It does not certify anything, and it cannot. Fannie Mae's own review certifies a project and the lender gives the warranty; a web page is not in that chain and should not pretend to be.
It is also one requirement out of many. A Full Review reads delinquency, owner occupancy, insurance and fidelity coverage, special assessments, critical repairs, litigation, commercial space and more. Clearing the reserve floor tells you one thing is not a problem. It tells you nothing at all about the rest.
And it takes your word for the two budget lines and for whether the reserve study qualifies. Those are readings of documents this page has never seen.
What exactly is the 10% reserve requirement?
Fannie Mae's Selling Guide asks that the association's annual budgeted replacement reserve allocation is at least 10% of its annual budgeted assessment income. It is a ratio of two lines in the budget, not a balance in the reserve account — an association with a healthy reserve balance can still fail it, and an association with very little saved can pass.
What changes on 4 January 2027?
The floor becomes 15% for loan applications dated on or after that date. Nothing changes for applications dated before it. That is why the date field above matters: the same budget can clear in December and fail in January, and the association will not have done anything wrong in between.
My association is under the percentage. Is that automatically a finding?
No, and this is the part most write-ups leave out. There is a second route: if a current reserve study — within the last three years, by an independent qualified professional — recommends an annual allocation and the budget funds that study's highest recommended allocation, the requirement can be satisfied that way instead. An association that is told it fails when this route is open has been told something false.
Does clearing this mean the project is eligible?
No. This is one requirement out of many. A Full Review also looks at delinquency, owner occupancy, insurance, special assessments, critical repairs, litigation and commercial space, among others. This tool answers one question properly and stops. Nothing here certifies a project — Fannie Mae's own review certifies, and the lender warrants.
Whose reserve study counts?
The tool asks you rather than deciding for you, because whether a study is current and whether its author is an independent qualified professional are judgements about documents this page has never seen. If you are not certain the study qualifies, answer no. An assumption in your own favour is exactly the kind of answer that becomes a problem in underwriting.
Why did Limited Review stop helping?
As of 3 August 2026 Limited Review is no longer available for established projects of more than ten units. Files that used to clear on a short screen now go through Full Review, which is where the reserve line, the delinquency roster and the repair history get read. The rule below did not change on that date — what changed is how many files it now gets applied to.
If the documents are the actual work
Typing two numbers is the easy version. The real job is a lender questionnaire: reading the budget, the reserve study, the aging report and the minutes, and answering for the whole project — with your name at the bottom.
That is what Wardline does. You give it the association's own documents and it returns what a Full Review will find, measured against the Selling Guide, with the page in your own file behind every figure. It never certifies a project, anything it cannot establish from the documents comes back blank rather than filled with a typical value, and every quoted figure is checked against the page it was cited to.