2026-09-10 · Colorado · Compliance

Buried in Freddie Mac's March 2026 bulletin is a sentence that gives a hail-battered Colorado association a named, lender-compliant route out of a 10% deductible: a deductible buy-back policy. Bulletin 2026-C, issued March 18, 2026 in consultation with the Federal Housing Finance Agency and in alignment with Fannie Mae, was incorporated into the Freddie Mac Guide by Bulletin 2026-6 on May 6, 2026.¹

The provision: “PUDs, ground lease communities, condominium HOAs and Cooperative Corporations may purchase a deductible buy-back insurance policy to meet our deductible requirements, provided the policy meets all other applicable property insurance requirements in Guide Chapter 4703.”

For an association facing the deductibles the Colorado Division of Insurance's own market study documented — “sometimes reaching 10%” — a buy-back layer is now an option of settled standing rather than a workaround of uncertain acceptability.

Why Freddie says it is doing all this

Freddie's version of the package is the one to quote to owners, because it states the causal chain:

“Since then, we have seen a correlation between Condominium Projects with underfunded reserves for capital expenditures and those in need of Critical Repair. Condominium Projects with inadequate reserves typically do not have the requisite resources to maintain the physical condition of the project or to fund unexpected operating expenses. As a result, unit owners can experience substantial financial hardship through unexpected special assessments or higher HOA assessments, leading to Mortgage default or foreclosure.”

It also acknowledges the other side: “We recognize that in certain areas, premiums and limited insurance availability are creating challenges for Borrowers and homeowners associations (HOAs).”

The deductible and HO-6 numbers

Effective for applications received on or after July 1, 2026: the 5%-per-unit maximum is retired, and “if the master property insurance policy includes a per unit deductible, the deductible now may not exceed $50,000 per unit.” The per-occurrence deductible may not exceed 5% of the building coverage limit.

An HO-6 is required where the master policy does not cover all or any portion of the unit interior or improvements, or where it includes a per-unit deductible. The HO-6 limit must be at least the greater of the amount sufficient to repair the unit to pre-loss condition, or the amount of the per-unit deductible — and its deductible “cannot exceed the greater of 5% of the coverage limit or $2,500.”

1. Freddie Mac Guide Bulletin 2026-6 (May 6, 2026) — incorporates the 2026-C condominium and property insurance updates into the Guide and widens the five-to-ten-unit exemption ↩
2. Freddie Mac Guide Bulletin 2026-C (March 18, 2026), full text — source of the quoted deductible buy-back, reserve, owner-occupancy and servicing provisions (vendor mirror; relink to a freddiemac.com copy where possible) ↩
3. "What Fannie Mae & Freddie Mac's Latest Policy Changes Mean for Condominium Associations, Lenders, and Homeowners" (March 18, 2026), Community Associations Institute Advocacy ↩
4. HB24-1108 Final Report: Analysis of HOA & Lodging Facilities in Colorado, Lewis & Ellis for the Colorado Division of Insurance (Colorado deductible findings) ↩