How to get a condo?

[DomRep]

Originally Posted by TurtleCreek80

Sounds like you are one step from the ledge, unless you have significant savings you didn't put down for some reason.

1. When did you buy your condo? Are you underwater? Do you have 10% equity? If not, selling will mean you're writing a hefty check at closing for realtors commissions and closing costs (yours and possibly the buyers if that is what is needed to close the deal). Think you won't need to move? What if you get laid off? Or meet someone and instantly outgrow that studio? Or get a job offer in another city that you can't turn down?

2. What about mandatory HOA assessments for major repairs and improvements? I live in a high rise area in my city and every single tower has had mandatory assessments in the past 5 years. They ranged from $10k to $45k for a 1 bedroom! Some were due within 60 days notice: others became a multi year payment plan. Keep in mind you can become foreclosed on for not paying these things!

I don't mean to pick on you, but your very situation (very little skin in the game) is a big part of why the real estate market collapsed. People didn't have enough equity to weather the storm or sell when they needed to (no equity).

I officially closed on September 30 of this year. I'm not underwater no, I'm not sure what this term means? I'm a newbie when it comes to those things.

I live in DC, lived here all my life, I don't foresee myself moving anywhere else. I plan on living here for at least 5 years. God forbid if I got laid off, Bank of American offered me a deal where if I got fired, they would pay my mortgage for a whole year. So if I got laid off or fired, I have 12 months to find a job.

It's a 621 square foot studio which is above average for the city. My girlfriend doesn't live with me. She has her house. If and when I make the decision to move, I am not going to re-sell my condo. It's too valuable for me to just sell it away. There's a $1.5 billion development going on in this area and while I'm not expecting my unit to appreciate as quickly as a one bedroom or even just a normal house, that doesn't mean I'm going to give it away. I'm here to stay. I knew what I could afford (I also have student loans) and I knew what I was looking for. I got tired of renting.

What do you mean about HOA assessments? I don't follow.

I figure the city I live in, DC we get hundreds of thousands of people coming into the area every year. $1400 for a studio condo, utilities included, 2 minutes from the metro rail/pharmacy/supermarket/waterfront is not a bad deal. Spacious too.

[TurtleCreek80]

Originally Posted by DomRep

I officially closed on September 30 of this year. I'm not underwater no, I'm not sure what this term means? I'm a newbie when it comes to those things.

I live in DC, lived here all my life, I don't foresee myself moving anywhere else. I plan on living here for at least 5 years. God forbid if I got laid off, Bank of American offered me a deal where if I got fired, they would pay my mortgage for a whole year. So if I got laid off or fired, I have 12 months to find a job.

It's a 621 square foot studio which is above average for the city. My girlfriend doesn't live with me. She has her house. If and when I make the decision to move, I am not going to re-sell my condo. It's too valuable for me to just sell it away. There's a $1.5 billion development going on in this area and while I'm not expecting my unit to appreciate as quickly as a one bedroom or even just a normal house, that doesn't mean I'm going to give it away. I'm here to stay. I knew what I could afford (I also have student loans) and I knew what I was looking for. I got tired of renting.

What do you mean about HOA assessments? I don't follow.

I figure the city I live in, DC we get hundreds of thousands of people coming into the area every year. $1400 for a studio condo, utilities included, 2 minutes from the metro rail/pharmacy/supermarket/waterfront is not a bad deal. Spacious too.

"Underwater" means you owe more on your mortgage than you could sell the property for today. 10% equity is the minimum you really need to have in your home (10% equity can be reached by a combination of things- down payment, appreciation in market value, and paying down your mortgage) without having to bring a check to closing. Realtors commissions & closing costs eat up an average of your sales price. Make sense?

People who are underwater get in a big jam if they need to sell becUse they may need to bring $50k, $200k, $500k, etc to the closing table to pay off their mortgage and realtors/closing costs....or else face foreclosure or try to get the bank to do a short sell (where the bank agrees to write off the loss to avoid foreclosure).

Condo Assessments are necessary when the HOA needs to do a major repair on the building (or fight major legal problems or any other $$$$) and they don't have adequate reserves saved up to do it without charging owners a "special" assessment. To replace 3 aged elevators in a 50+ year old building can cost $1M....divide that by, say, 200 condos and you're got yourself a $5,000 assessment- probably due ASAP so the work can start!

I have seen or known about assessments to replace balcony railings, roofs, HVAC issues, elevators, exterior windows & doors, and "necessary improvements/ upgrades" like lobby renovations. Even in new buildings there can be major issues. My friend's condo sued their builder for some major maintenance issues that were popping up on a 5 year old complex. She was paying an extra $300/mo for over a year just on attorney's fees since if is a small complex. These are ALWAYS a possibility with condo ownership- which makes condos not be the best investment because of the uncertaintly.

You pay for repairs & upgrade's on someone else's schedule (your board), not your own. They don't care if you'd rather wait 2 more months until your annual bonus comes in to pony up for the repair; they need your $7,500 check by next Friday or you'll start getting late fees and possibly foreclosure. Extreme examples, but about .5% of our units have gone into foreclosure due to assessments- mostly really young people without adequate savings or retirees on fixed incomes.