A bill would let a condominium association itself borrow for repairs — and it has not moved
A bill would let a condominium association itself borrow for repairs — and it has not moved
2026-09-21 · Wisconsin · Legislation · Proposed — not yet introduced
Wisconsin condominium associations facing a large repair have two ways to pay for it: raise regular assessments, or levy a special assessment. A bill in Congress would create a third — let the association borrow, with FHA insuring the loan and the association's own lien rights as security.
H.R. 9569, the Making Condos Safer and Affordable Act of 2026, was introduced June 30, 2026 by Representative Debbie Wasserman Schultz, for herself and Representative Maria Elvira Salazar. It was referred to the House Committee on Financial Services the same day. The official bill-status record shows no action since.1
Its long title: “To amend the National Housing Act to authorize insurance of certain mortgages to finance repairs and improvements to condominium projects, and for other purposes.”
The association as borrower
Section 2 would add a new subsection (l) to § 234 of the National Housing Act:2
“(1) In general.—In addition to mortgages insured under the other provisions of this section, the Secretary may insure, in the discretion of the Secretary and under such terms and conditions as the Secretary may prescribe, a mortgage— (A) that finances, in the case of condominium projects, the costs of a rehabilitation, alteration, repair, improvement, or replacement of any common system, infrastructure, facility, feature, portion, or area serving the project; and (B) under which the mortgagor is the governing body of the condominium project.
(2) Loan limit.—To be eligible for insurance under this subsection, a mortgage may not involve a principal obligation in an amount exceeding 90 percent of the cost of the proposed rehabilitation, alteration, repair, improvement, or replacement project.”
The security is the part that reaches Wisconsin law. The bill expands “mortgage” for these purposes to include a loan “secured by future lien-based mandatory unit owner payments required pursuant to State statute, a recorded declaration of covenants, or lawful rule, by-law, or guideline adopted by the governing body of the condominium project, real property, or a combination thereof.”
Why that security description fits Wisconsin exactly
“Future lien-based mandatory unit owner payments required pursuant to State statute” is a description of what Wis. Stat. § 703.165 already provides. Wisconsin gives a condominium association an express assessment lien, and § 703.165(2) makes liability unavoidable: a unit owner “shall be liable for all assessments, or installments thereof, coming due while owning a unit, including any assessments coming due during the pendency of any claim by the unit owner against the association,” and liability “may not be avoided by waiver of the use or enjoyment of any common element or by abandonment.”
A Wisconsin court applied precisely that in February 2026, affirming a money judgment and a foreclosure judgment over a $1,200 pier assessment. The lien works. What Wisconsin associations lack is a way to turn a reliable future assessment stream into capital today at insured-loan pricing.
The owner-side provisions
Section 3(a) would add a new clause to § 203(k)(2)(A) of the National Housing Act, letting a unit owner roll a special assessment into a rehabilitation loan:
“(iv) in the case of a dwelling unit in a condominium and notwithstanding any other law, regulation, or guideline of the Secretary, including subpart C of part II of the FHA Single Family Policy Handbook 4000.1…, the payment of a non-regular assessment charged by the governing body of the condominium project to the unit owner to cover costs of a future rehabilitation, alteration, repair, improvement, or replacement of any common system, infrastructure, facility, feature, portion, or area serving the project.”
It would also insert into § 203(k)(2)(B) the phrase “or the funding of reserves for future project-level improvements or repairs,” and direct the Secretary to “streamline regulations and guidelines applicable to verification of rehabilitation and repair plans, management of rehabilitation work, disbursement of loan proceeds, and certification of work completion.”
Section 3(b) reaches Title I property improvement loans, adding the same non-regular assessment as an eligible purpose and raising the loan limit from $25,000 to $55,000, with annual CPI-U indexing thereafter.
Why it would matter here specifically
Wisconsin's position is unusual in a way that makes association-level borrowing more relevant than it would be elsewhere.
State law requires nothing. Section 703.163 is opt-out by design, prescribes no funding level, and at subsection (10) immunises the decision not to fund reserves. There is no Wisconsin condominium inspection mandate. So the deferred-maintenance bill arrives without warning and without a reserve behind it.
Meanwhile the mortgage market is tightening around exactly that. Fannie Mae's Selling Guide requires a replacement-reserve allocation of at least 10 percent of the budget, with a rise to 15 percent announced for applications dated on or after January 4, 2027, and its Full Review examines budget, reserves, insurance, delinquencies, litigation, special assessments and inspection reports. The Guide excludes special assessment revenue from the reserve calculation, so an association that funds a repair by special assessment gets no reserve credit for it.
A loan at the association level, repaid out of regular assessments, is the one structure that addresses both the repair and the reserve ratio. Our Wisconsin reserve studies and budget approval pages cover the framework it would sit inside.
Be realistic about the odds
A bill referred to House Financial Services on June 30, 2026 with no hearing, no markup and no companion action by late September is not close to becoming law this Congress. The official record shows four entries, all dated June 30, 2026: introduced, and referred.
Both sponsors represent Florida districts, which is where the condominium-safety financing problem has been most acute. The bill has also been introduced in a prior Congress without passing.
What to watch next
The marker to watch is a hearing in House Financial Services, which is the first thing that would distinguish this from a message bill. Nothing in Wisconsin law would need to change for the association-borrower structure to work here — § 703.165 already supplies the security the bill describes — so if it ever moves, Wisconsin associations would be able to use it immediately.
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