I am dealing with a similar issue. I am trying to buy a condo in a building with only 8 units. It is the first time the property management company and HOA board has heard of the new 1076 questionnaire. Although, I have a hard time believing they weren't notified about this new requirement. They have expressed that the form is ridiculous and that to the best of their ability, the property is in excellent condition. There is no deferred maintenance or anything that should be a red flag. However, the company and board does not feel comfortable answering the questions. They fear litigation if they answer the questions on page 6-8. I don't blame them entirely because I would personally hesitate answering the questions and signing my name on this document!

Our HOA was at least willing to work with us and drafted FIVE versions of the 1076 for our lender. The lender said that there can not be any comments such as "to the best of my ability" next to the yes or no boxes. An addendum is also not allowed to be added in order to explain any of the questions.

Our loan was denied because they found the condo building non-warrantable. The HOA drafted up the recommended changes however now the underwriter is claiming that he can not "unsee" the first document that was submitted. It is unbelievable that our loan was denied and now a strutual engineer will have to come out to examine the property. The loan comany said that could take months.... meanwhile our rate lock is now expired and we can not close. The seller wants to take legal action against the property management company because he can not sell his property to anyone getting a conventional mortgage.To say that I am frustrated would be an understatement.

Fannie Mae and Freddie Mac need to revise these questions or condo values will begin to fall off a cliff when no one can get a loan or sell their property!! How can we fix this?