# What are the red flags in a Status Certificate for a lender?

> Lenders look for: (1) Inadequate Reserve Fund (lower than the study recommends), (2) Current or pending litigation against the corporation, (3) High percentage of rented units vs owner-occupied (some lenders cap at 30% rental), (4) Major 'work orders' from the city that are unaddressed, (5) Deficit in the annual operating budget.

Category: Purchasing
Last verified: 2026-02-18
Source: https://ratellow.com/faqs/purchasing/what-are-the-red-flags-in-a-status-certificate-for-a-lender

## Answer
Lenders look for: (1) Inadequate Reserve Fund (lower than the study recommends), (2) Current or pending litigation against the corporation, (3) High percentage of rented units vs owner-occupied (some lenders cap at 30% rental), (4) Major 'work orders' from the city that are unaddressed, (5) Deficit in the annual operating budget.

## Related guide
- https://ratellow.com/guides/condo-mortgage-nuances

## Sources
- FCAC Condo Buying Guide — https://www.canada.ca/en/financial-consumer-agency/services/mortgages/renew-mortgage.html#toc3
- B-20 Condo Underwriting — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/residential-mortgage-underwriting-practices-procedures-guideline-2017#2.4.2