Impact Reserves Funding & Project Completion


By Ila Kane, CMCA, AMS, PCAM of Agynbyte, AAMC


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Lenders of home loans and mortgages are taking a closer look at deferred maintenance and special assessments


for HOAs and COAs because of updated secondary lending requirements.


Board members and homeowners will face heightened scrutiny on 


funding projects as the banks that buy home loans shy away from associations that have poor reserve funding, major or repeat special assessments, or incomplete “critical maintenance” projects.


18 Community Associations Journal | March 2024


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Lenders will also require that associations allocate at least 10% of the annual budget to the reserve account.


The result of these new requirements and closer examination of resale documentation is that sellers and


 to close on a loan if an association hasn’t completed projects related to life-safety or isn’t funding the reserve account to the amount deemed appropriate by a lender.


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