‘Perfect storm.’ Hundreds of Florida Condos Now on Secret Mortgage Blacklist

A rapidly growing, largely secret condo blacklist is creating serious challenges for condo owners and associations across South Florida. Maintained by federally chartered mortgage giant Fannie Mae, the list now includes 696 condo buildings in Miami-Dade, Broward, and Palm Beach counties. That’s nearly half of all the Florida properties deemed ineligible for Fannie Mae-backed financing. Buildings typically end up on this list due to financial instability, lack of insurance, or unresolved critical maintenance issues. Being blacklisted makes it extremely difficult for owners to sell their units or obtain loans for repairs. Many only find out they’re on the list when a mortgage application gets unexpectedly denied. Miami attorney Jake Marcus, whose law firm Allcock Marcus has been tracking the list, describes the situation as “a perfect financial storm” driven by tighter safety regulations and market pressures.

Mortgage Trouble and Safety Rules After Surfside

Following the 2021 Surfside condo collapse, Fannie Mae and Freddie Mac—who back around 70% of U.S. home loans—imposed stricter guidelines. Now, buildings must pass rigorous financial and structural reviews before loans can be approved. Key disqualifiers include inadequate reserves, insurance gaps, deferred maintenance, and structural damage. In response to Surfside, the Florida Legislature also introduced sweeping new laws in 2023 and 2024. Condos over three stories must now conduct regular inspections and maintain sufficient reserves for anticipated repairs. Many associations, especially those that previously waived reserve requirements, are struggling to comply. Some have not yet submitted the required inspection reports, which were due earlier this year. The result? Many condos are financially strained and at risk of falling into disrepair. Buildings older than 30 years are especially vulnerable under the new rules, making it harder for them to meet mortgage eligibility criteria.

Owners Trapped Between Repairs and Falling Values

The blacklist has placed many condo owners in a tough position. They face soaring maintenance fees, rising insurance costs, and special assessments—yet cannot sell their units due to loan restrictions. Even associations trying to fund needed repairs are having trouble securing financing. Marcus says insurance shortfalls are the most common reason buildings land on the list, followed by deferred maintenance and critical structural needs. Some buildings are also flagged due to their classification as condo-hotels, which raises concerns about financial stability. The increasing financial strain has started to affect the real estate market: sales are slowing, while listings are piling up. Condos, once seen as the affordable path to homeownership in Florida, are now becoming costly liabilities for some.

Developers May Benefit From Financial Pressure

As financial pressures grow, many experts predict that bulk sales to developers may become more common. Though such deals are currently difficult due to Florida’s condo laws—where a small minority of owners can block a sale—there is growing interest in loosening those restrictions. “People are going to lobby for it,” said Marcus. “It may become a more appealing option than levying huge assessments just to stay afloat.” Fannie Mae has declined to make the blacklist public. However, Allcock Marcus offers a confidential online service for condo associations to check their status and seek removal from the list.