Last reviewed: October 5, 2026
Quick answer: Every major loan program counts your condo association dues as part of your monthly housing payment. Fannie Mae adds dues and any special assessment to PITIA; FHA adds HOA fees to the total mortgage payment; VA counts condo fees and special assessments in its 41% debt-to-income ratio and in residual income. At a 6.5% 30-year rate, each $100 a month of dues reduces the loan you can qualify for by roughly $15,800. Separately, lenders check whether the building itself has too many owners behind on assessments (no more than 15% of units 60+ days late for Fannie Mae full review and for FHA).
This is part of our Chicago condo loans guide.
How do HOA dues count in a mortgage application?
Lenders qualify you on your full monthly housing cost, not just principal and interest. For a condo, that cost includes the association’s regular assessment, and often a special assessment too. The higher the dues, the less of your income is left for the loan payment, so dues directly shrink the price you can afford.
| Program | What is counted | Debt-to-income limit |
|---|---|---|
| Fannie Mae (conventional) | PITIA: principal and interest, property, flood and mortgage insurance, real estate taxes, ground rent, special assessments and owners’ association dues (B3-6-03) | 36% manually underwritten, up to 45% with credit score and reserve requirements; up to 50% through Desktop Underwriter (B3-6-02) |
| FHA | Total mortgage payment includes HOA or condominium association fees (Handbook 4000.1) | Manual underwriting benchmark 31% housing / 43% total; higher ratios allowed with documented compensating factors or an automated TOTAL Scorecard accept |
| VA | PITI plus special assessments, condominium fees and homeowners association fees; also the association assessment in residual income (38 CFR 36.4340) | 41% standard; higher allowed with supervisor justification, or without it when residual income beats the guideline by at least 20% |
Does the whole association fee count?
Mostly, yes. Fannie Mae counts association dues including utility charges for the common areas, but excludes utility charges that apply to your individual unit. FHA lets the portion of the fee clearly attributable to utilities be subtracted before ratios are computed, if you document it (for example with a utility statement). Many Chicago high-rises fold heat, water or cable into the assessment, so ask the association or management company for a breakdown before you apply.
Both the regular assessment and any special assessment you will be paying go into the calculation. If the association has approved a special assessment that will be billed monthly after closing, expect the lender to add it. For how special assessments are approved and reviewed, see our condo special assessments guide.
How much do dues reduce what I can borrow?
An illustration, not a quote. Assume gross income of $8,000 a month, $500 a month of other debts, property tax of $400 a month, an HO-6 premium of $30 a month, no mortgage insurance, a 45% total debt-to-income ceiling and a 30-year fixed rate of 6.5%. If you will live in the unit, claiming the Cook County homeowner exemption can lower the property tax your lender counts; see how to claim the homeowner exemption.
| Detail | $250/month dues | $650/month dues |
|---|---|---|
| Maximum total debts (45% of $8,000) | $3,600 | $3,600 |
| Less other debts, tax, HO-6 and dues | $1,180 | $1,580 |
| Left for principal and interest | $2,420 | $2,020 |
| Approximate loan amount at 6.5% | about $382,900 | about $319,600 |
The $400 difference in monthly dues costs about $63,000 of borrowing power. That is why two units at the same list price can be very different purchases, and why a unit with low dues in a building with thin reserves can turn expensive later if a special assessment arrives.
How does VA treat condo fees differently?
VA applies two tests. The debt-to-income ratio includes condominium and homeowners association fees and special assessments, with a 41% standard. VA also requires residual income: money left after the estimated monthly shelter expense and other obligations. For a condo, the shelter expense must include the association’s maintenance assessment. If the current assessment is below the maximum allowed in the declaration and looks insufficient to run the building, the regulation says to use the maximum the veteran could be charged, and to use any expected special assessments.
For loans of $80,000 and above, the regulation’s Midwest residual income guideline (which covers Illinois) is $441 for a household of one, $738 for two, $889 for three, $1,003 for four and $1,039 for five. More on VA building approval is in our VA condo loans guide.
What if other owners are behind on their dues?
Your own dues affect your approval; everyone else’s dues affect the building’s. In a Fannie Mae full review, a project is ineligible if more than 15% of units are 60 or more days delinquent on assessments, and FHA project approval uses the same 15% limit. Lenders find this out from the condo questionnaire, so a building with collection problems can sink a loan even when the buyer is strong. See condo questionnaire and HOA review and FHA condo approval.
What happens to unpaid assessments when a Chicago condo sells?
- Disclosure before closing: under 765 ILCS 605/22.1, a resale disclosure includes a statement of any liens and unpaid assessments and other charges due on the unit. Read it before you remove contingencies.
- The lien: under 765 ILCS 605/9(g), unpaid common expenses are a lien on the unit in favor of the board for all owners.
- Lender’s request: under 9(j), a mortgage holder can ask the board in writing for a statement of unpaid common expenses; if the board does not answer within 20 days, unpaid amounts due before the request are subordinate to the mortgage.
- Foreclosed units: under 9(g)(3) and (4), a foreclosure-sale buyer owes assessments from the first day of the month after the sale, and a buyer other than the foreclosing mortgagee (or someone buying from the mortgagee) also owes up to 6 months of the prior owner’s unpaid assessments from before the association’s collection action. If you are buying a bank-owned or foreclosure unit, have your attorney confirm what is owed.
Assessments due at closing and association fees are covered in our condo closing costs guide.
What should I check about dues before I apply?
- The current monthly assessment for the specific unit (it varies with each unit’s percentage of ownership).
- What the assessment covers (heat, water, cable, internet), and whether you can document a utility portion.
- Any approved or planned special assessment, its monthly amount and its payoff date.
- The current budget and whether an increase is expected for next year; Illinois owners can petition to vote on a budget that raises total assessments more than 115% of the prior year’s.
- Reserves: Fannie Mae requires at least 10% of the budget for replacement reserves in a full review, rising to 15% on January 4, 2027, which may push some budgets up.
Then run the numbers with your loan officer using the real dues, not the listing estimate. For down payment, PMI and the condo pricing adjustment, see condo down payment and PMI; for investor and second-home units, where the full payment counts as a debt, see investment condo loans.
Frequently asked questions
Are HOA dues included in my debt-to-income ratio?
Yes. Fannie Mae, FHA and VA all count association dues as part of the housing payment used in the debt-to-income ratio.
Do HOA dues get paid through my mortgage escrow?
Usually not. Most Chicago owners pay the association directly each month, even though the lender counts the dues when qualifying you. Taxes and insurance are what typically go into escrow.
Does a special assessment count against my loan approval?
It can. Fannie Mae lists special assessments in monthly housing expense, and VA’s ratio and shelter expense include special assessments, including expected ones.
Can utilities in my HOA fee be left out?
Partly. Fannie Mae excludes charges for utilities to your individual unit, and FHA allows a documented utility portion to be subtracted before computing ratios.
Can other owners’ late dues stop my loan?
Yes. If more than 15% of units are 60 or more days delinquent, the building fails Fannie Mae full review and FHA approval standards.
Sources
- Fannie Mae Selling Guide B3-6-03, Monthly Housing Expense for the Subject Property (12/16/2020): selling-guide.fanniemae.com
- Fannie Mae Selling Guide B3-6-02, Debt-to-Income Ratios (04/02/2025): selling-guide.fanniemae.com
- Fannie Mae Selling Guide B4-2.1-03 and B4-2.2-01 (08/05/2026), project delinquency and reserve standards: selling-guide.fanniemae.com
- 38 CFR 36.4340, VA underwriting standards (debt-to-income, residual income, shelter expense): law.cornell.edu
- HUD Mortgagee Letter 2014-02, manual underwriting qualifying ratios: hud.gov; HUD Handbook 4000.1, calculating total mortgage payment (HOA fees and condominium utility expenses)
- Illinois Condominium Property Act, 765 ILCS 605/9 (lien for unpaid common expenses): ilga.gov; 605/22.1 (resale disclosures) and 605/18(a)(8) (115% budget petition)
Educational content only. Chicago Condo Loans is not a lender or broker, and nothing here is lending, legal or financial advice. Confirm current rules and your own numbers with a licensed loan officer and an Illinois real estate attorney.