Do we need a reserve study or can we move without one?
You need a reserve study, or at least a current reserve-funding statement from the HOA. Different lenders have different requirements, but most want to see some documented analysis of reserve adequacy. Moving forward without one is possible in limited cases, but it usually triggers additional questions and delays.
Why it's not always simple
Some lenders have waivers or exceptions for reserve studies in certain scenarios (small projects, established financial history). But even those exceptions usually require documentation of why the study is waived. The safest approach is to have one upfront.
Additionally, reserve studies vary in quality — some are comprehensive and current, some are sketchy and outdated. The lender's scrutiny depends on the quality.
What people usually miss
People often think if the HOA has provided budget and financial information, a separate reserve study isn't necessary. What usually gets missed:
- The reserve study provides information budget and financials don't (funding timeline, adequacy analysis, capital-improvement projections)
- Without a reserve study, the lender often asks follow-up questions about whether reserves are adequate
- A missing reserve study is especially problematic if reserves appear low — without the study, the lender can't assess whether the low level is expected or concerning
- Not requesting the reserve study early enough, so it becomes a late-stage document request
- Assuming an old reserve study is fine — lenders often want current studies
The real problem: reserve studies are a standard expectation, and not having one creates uncertainty that usually delays the file.
Example
A processor moves a file forward with HOA budget and financials, thinking that's enough. The reserve information shows reserves at 50% funded but there's no reserve study to explain whether that's adequate or concerning. The lender asks for a reserve study to understand reserve adequacy. The property manager has to commission a new study or find an old one, which takes 4–6 weeks. If a reserve study had been requested upfront, this delay could have been anticipated.
If this is a real file
Request the reserve study along with initial financial documents. If the HOA doesn't have a current one, ask when it was last updated and whether it's sufficient for the lender's purposes. A missing reserve study is a red flag that needs addressing early.
If you want to understand whether a reserve study is critical for your specific file and what reserve adequacy will likely be flagged as an issue, you can run a 60-second pre-screen.