What Banks look for when reviewing your Condo Documents

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December 1, 2025

When you’re buying a condo or townhouse in Canada, the focus is usually on the unit: the floor plan, the location, the amenities, the view. But from a mortgage-qualification standpoint, the lender is just as interested in the building as they are in you. And there’s a good reason for that.

People forget this—your lender evaluates the property as though they are buying it. Because in a worst-case scenario (a foreclosure), they are the ones on the hook for it. So their due diligence on the strata/condo documents isn’t meant to slow you down or frustrate the process… it’s designed to make sure you’re not stepping into a building that could compromise your financial well-being.

Below is an inside look at what lenders—and mortgage insurers—are really looking for in a strata document package, and why this review matters just as much as your income and credit.

What Lenders Expect to See in a Strata Package

1. Form B (dated within 90 days)

This is the backbone of the strata package. Lenders use it to confirm:

Whether the strata is involved in lawsuits
Your monthly strata fees
The current contingency reserve fund (CRF) balance
Any strata loans (critical—must be able to debt-service)
How much money exists per unit based on the size of the CRF vs. total units

A weak Form B can tank an approval quickly.

2. Last 2 Years of AGM/SGM Minutes

Lenders want a window into the building’s “politics”:

What projects were voted on?
Are strata fees rising—and why?
Are owners pushing repairs down the road?
Is there ongoing conflict, mismanagement, or repeated issues?

Minutes reveal how the building is being run, which often matters more than the building itself.

3. Current Budget + Financial Statements

This shows:

How the strata generates and allocates money
Whether the budget is realistic
If the CRF contributions match future repair needs

A building with low fees and chronic under-funding can be more risky than one with moderately higher fees and healthy reserves.

4. The Depreciation Report (updated every 5 years)

This is the big one.

Lenders and insurers focus on:

The 30-year maintenance plan
Whether the strata is actually following the plan
The three funding models (baseline, improved, full funding)
Whether the building is preparing for upcoming capital projects

A property with major upcoming work and no plan to fund it is a red flag—especially if you’re a low-down-payment mortgage applicant (e.g., 5% down payment). A buyer with maxed-out debt ratios may not have room in their budget for future special assessments.

5. Optional but Often Valuable: Engineering Reports + BECA

These provide deeper insight into:

Building Envelope Condition Assessment (BECA)
Structural integrity
Remaining lifespan of major components

They help lenders assess long-term suitability—especially with older buildings.

The Misconception: “My lender never asked for strata documents.”

This is where buyers get blindsided. Some lenders don’t request the strata documents during the financing-conditions phase. That leads clients and some brokers to assume “strata docs weren’t needed.” But here’s the reality:

Every single lender requires the strata documents to be reviewed for a purchase. The question is who does the review.

Two possibilities:

A) The lender reviews the package directly (best-case scenario). You get upfront clarity before removing subjects.

B) The lender delegates the review to the lawyer/notary (risky scenario). This often happens after you remove conditions.

Meaning:

You’ve waived subjects
You’re unconditional on the purchase
Then the lawyer reviews the strata docs
They report any issues to the lender
The lender can still reverse or decline the approval

It doesn’t happen often… but it does happen. And when it does, it could be very problematic.

Your Best Move? Always Send the Strata Documents to Your Mortgage Broker.

Don’t assume silence means everything is fine.

Be proactive:

Send the full strata package as soon as you have it
Flag anything you’re concerned about (you know the building better than the lender)
Ask questions
Don’t hide issues—lenders always find out eventually

Remember: you’re about to make the largest purchase of your life. You should be just as diligent as the lender in making sure:

The building is healthy
The strata board is competent
Future repairs are funded
There are no ticking time bombs behind the scenes

A condo is not just a home—it’s an investment tied to the financial health of dozens or hundreds of other owners.

Final Thoughts

Strata document reviews aren’t meant to create friction—they’re meant to protect you. Lenders scrutinize these documents because they’re effectively your financial partner in this purchase. If something goes sideways, they inherit your property. So the next time a lender or insurer gets picky about a Form B detail or a depreciation-report line item, remember: they’re stress-testing the building the same way they stress-test your ratios. Their goal is the same as yours—long-term success and stability.

Call, text, or email Marko right now to discuss in greater detail.