What the secondary market is reported to be doing

The Community Associations Institute reported in March 2026 on project-eligibility changes announced by Fannie Mae and Freddie Mac, citing Lender Letter LL-2026-03.¹ This is trade reporting on a lender policy, not a statute, and the figures below are CAI's account of it rather than the lender letter's own text. As reported:

• The reserve minimum rises from 10 percent to 15 percent of the annual budget, effective January 4, 2027 — unless the association has a reserve study updated within three years and funds at the highest recommended level. Baseline funding is reported to be no longer accepted.
• Insurance: a maximum deductible capped at $50,000 per unit effective July 1, 2026; strict replacement-cost documentation; the roof full-replacement-cost and inflation-guard requirements eliminated; annual servicer verification of coverage from January 1, 2027.
• Reviews: limited review retired effective August 3, 2026; waiver eligibility expanded to projects up to 10 units; the 50 percent investor-concentration limit eliminated.

Why a Vermont board cannot treat this as somebody else's rule

Project eligibility is not about the association's finances in the abstract. It is about whether a buyer in the building can get a conventional mortgage. A Vermont condominium that falls out of eligibility does not get a letter; it gets a unit that will not sell.

And because Vermont mandates nothing, the 15 percent figure is not a floor on top of a state requirement. It is the only number in the system.

The exception is the interesting part

The reported carve-out is a reserve study updated within three years, funded at the highest recommended level. Vermont requires no study, so a Vermont association that commissions one is doing something entirely voluntary — and, on these reported terms, buying itself out of a fixed percentage.

That is a decision with a budget consequence, and in Vermont the budget process runs through 27A V.S.A. § 3-123's negative-option ratification: the board adopts, owners get the summary within 30 days, a meeting follows in 10 to 60 days, and the budget is ratified “unless at that meeting a majority of all unit owners … reject the budget … whether or not a quorum is present.”

A board proposing a reserve increase in Vermont needs a majority of all owners to stop it. Silence carries it.

One trap to avoid

Searching for condominium reserve requirements surfaces Florida's milestone inspection and structural integrity reserve study regime constantly. That is Florida law and Vermont has no analogue. Vermont has no milestone inspection statute, no structural integrity reserve study requirement, and no scheduled structural inspection anywhere in Title 27A.

What Vermont has instead is the association's general duty to maintain, repair and replace the common elements under § 3-107, the statewide Fire and Building Safety Code administered by the Division of Fire Safety — which reaches condominiums because 20 V.S.A. § 2730(a)(1)(C) makes one a “public building” — insurer requirements, and the declaration.

What the legislature has done about it

Nothing, and not for want of the subject being available. A full-text sweep of the 2025–2026 biennium returns zero bills on reserve studies or reserve funds for Vermont associations. Reserve funding is not among the four items in the Act 179 study due November 15, 2026 either.

What to watch next

January 4, 2027, as reported. A Vermont board that wants the reserve-study exception rather than the percentage needs the study commissioned, completed and reflected in a ratified budget before then — and § 3-123's notice and meeting timetable alone consumes 40 to 90 days.