A person preparing to purchase a Bellevue condo received unexpected news during the loan approval stage. While the unit itself was not an issue, the financial status of the association did not meet the lender's criteria, making the conditions more stringent. They learned for the first time that when buying a condo, the overall financial health of the building is assessed alongside their credit score.

To understand this better, let's first clarify what HOA fees include. These fees cover the maintenance of the building's exterior and roof, master insurance, shared facilities like pools or gyms, landscaping, trash collection, and sometimes a portion of water or heating costs, as well as contributions to the reserve fund. In simple terms, think of it as the money that unit owners collectively pay to maintain the entire building. The national average ranges from $200 to $400 per month, while high-end condos with more amenities can go from $500 to over $1,000. This data is based on NAR and realtor.com sources.

Bellevue is definitely on the higher end of this average. The average HOA fee for Bellevue condos is around $620 per month, with a range from $350 to over $1,500. Some reports indicate that this is 113% higher than the national average. The median HOA fee for King County, where Bellevue is located, is reported to be $495 per month. There is also a clear trend showing that high-rise condos tend to have higher fees compared to townhome communities.

Recently, Washington State has made significant changes to reserve fund regulations. In simple terms, this means that the law has expanded to require associations to set aside funds for building repairs in advance. The reserve provision of the Washington Uniform Common Interest Ownership Act (WUCIOA) (RCW 64.90) will start applying to all older associations established under previous condominium or HOA laws beginning January 1, 2026. Reserve studies must be updated annually, and professional inspections must be conducted at least every three years, with reserve funds kept in a separate account. If the terminology is unfamiliar, think of it this way: now even older condo buildings in Bellevue must systematically build reserves without exception.

So, how does this relate to loans? Fannie Mae's condo project guidelines assess the association's delinquency rate, reserve accumulation ratio, litigation status, and commercial space ratio together. If these criteria are not met, the condo may be classified as non-warrantable, leading to loan denial or unfavorable terms. As mentioned earlier, even if the unit itself is fine, loans can be blocked due to the association's financial statements.

The official document that verifies this information is the resale certificate. According to RCW 64.90.640, the association must provide this document within 10 days of request, which contains 26 items of financial and legal information. The issuance fee cannot exceed $275, and the buyer is also granted a non-cancelable 5-day right to rescind the contract. This provision will be implemented without a grace period starting January 1, 2026, so if you are preparing a contract in Bellevue, obtaining this document should be your first step.

To summarize the items to check before signing a contract:

• Recent reserve study results and accumulation ratio
• Delinquency rate and ongoing litigation status
• History of special assessments in the last 2-3 years
• Regulations regarding rentals, pets, and renovations

If you are a family looking for a preferred school district, you should consider these financial items along with the school district ratings. School district boundaries change frequently, so be sure to verify the assigned school for the specific address. Families moving from other states should also note that Washington State has no state income tax, but the property tax and insurance structures may differ from their previous residence. Delays in loan approval can disrupt the entire closing schedule, so checking the association's financial status should be the first thing you complete before making an offer. This article is not investment or legal advice, and it is recommended to consult a professional before finalizing any contracts.