Condominium Rider
The Fannie Mae/Freddie Mac rider for condominium mortgages — incorporating HOA provisions, project assessments, and insurance requirements.
The Condominium Rider (Fannie Mae Form 3140 / Freddie Mac Form 3140) is a rider attached to the Mortgage or Deed of Trust for condominium loans. It modifies the standard security instrument to address condominium-specific issues: (1) the condo project's master insurance policy (the lender requires proof of condominium association insurance covering the building structure), (2) the homeowner's obligation to pay condominium association dues and assessments (failure to pay HOA dues is a default under the mortgage), (3) the HOA's right to impose a super-priority lien for unpaid assessments (in many states, HOA liens have priority over the first mortgage for a limited portion of unpaid assessments), (4) condominium project dissolution or condemnation provisions, and (5) the requirement to provide the lender with the HOA's financial statements and project documents. The Condominium Rider protects both the lender and, indirectly, the homeowner by ensuring the condominium association remains solvent and insured.
Purpose
- 1Address condominium-specific mortgage provisions: HOA dues, project insurance, and super-priority liens
- 2Ensure the lender's security interest is not compromised by condominium association issues
- 3Make failure to pay HOA dues a default under the mortgage
Who Prepares It
The lender prepares the Condominium Rider (Fannie Mae/Freddie Mac uniform form 3140). The borrower signs at closing. Recorded with the Mortgage/Deed of Trust.
When It Is Used
Used for ALL condominium loans (when the property is a condominium unit, whether single-family attached, townhouse-style condo, or high-rise condo).
Legal Effect
The Condominium Rider makes condominium-specific obligations part of the mortgage contract. Failure to pay HOA dues is a default — the lender can foreclose. The HOA's super-priority lien (in states that have them) may prime the first mortgage for a limited portion (typically 6 months of assessments or $X statutory maximum). If the condominium project is terminated or condemned, the mortgage provisions for insurance/condemnation proceeds apply.
Common Mistakes
Homeowner Rights
Other Security Instruments Documents
Mortgage / Deed of Trust
The security instrument that pledges your property as collateral — understanding this document is essential to understanding how foreclosure works.
Deed of Trust
The security instrument used in non-judicial foreclosure states — a three-party instrument that allows a trustee to sell the property without court involvement.
Satisfaction of Mortgage
The document that releases the mortgage lien after the loan is paid in full — and what happens when the lender fails to record it.
FHA Security Instrument
The FHA-specific Mortgage or Deed of Trust that incorporates HUD regulations and provides unique borrower protections.
VA Security Instrument
The VA-specific Mortgage or Deed of Trust for veteran home loans — incorporating unique SCRA protections and VA servicing requirements.
PUD Rider (Planned Unit Development)
The Fannie Mae/Freddie Mac rider for PUD mortgages — addressing HOA dues, community amenities, and association governance.
USDA Mortgage Documents
The USDA-specific mortgage instruments for Rural Development loans — incorporating RD regulations and providing unique loss mitigation options.
Frequently Asked Questions
Can the HOA foreclose on my condo?▼
Yes, in most states, the HOA can foreclose on a condominium for unpaid assessments. In many states, the HOA has a STATUTORY SUPER-PRIORITY LIEN — meaning the HOA's lien for a limited number of months of assessments (typically 6 months) primes (takes priority over) the first mortgage. This means the HOA can foreclose and WIPE OUT the first mortgage for the super-priority portion. This is a separate risk from the mortgage servicer's foreclosure. Always prioritize HOA dues — even if you're in mortgage default.
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