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One problem though: "insolvent" for a condo association is not a black and white thing.
Oh boy, is that the truth!! Read it, and read it again my condo buying friends!
My old condo was well funded, and the board worked really hard to keep fees low while properly funding the reserves. I was on the board for a while and we sweated every little penny and poured over every word of our future funding projection reports.
Our condo fees were significantly higher than another community down the street, and buyers would sometimes get snippy about it. We'd say, "you'd better take a good look at their financials." They were about 5 minutes from broke; they were deferring maintenance and underfunding reserves. In fact, I think they'd basically stopped adding to long term reserves at all!
The HOA is required to provide Condo Docs and Budget information on behalf of sellers. This benefits both the new buyer and the HOA. For the buyer, it ensures that the information is current and accurate (and that the seller is not simply providing the latest version/updates/budget he may have). For the HOA, it ensures that the new (potential) buyer has the current DOCS and budget.
True, once OP is a buyer (rattified purchase contract). The HOA is not obligated to provide anything to lookers, however. They usually won't.
By all means, have your realtor ask questions about rentals, pets, etc. But the answers aren't binding unless they're in the official condo docs. We used to get buyers who would say, "But the seller and her realtor said we could have three 80 lb dogs!" and we'd say, "The condo docs clearly state no dogs over 25 lbs and no more than one pet. Sorry". It was sad, but the official rules are binding.
When and how docs are to be provided can and will vary. Never trust/assume someone will give them to you. Be sure you obtain a copy. Some associations have them online. A smart seller will give you a copy so there are no problems down the line.
In my association when purchasing a home (only 8 of 113 remain), you pick a lot and a model. You sign a 30 day letter of intent to purchase. At that time you are given a copy of all documents. You actually sign for the copy. You and the developer have 30 days to work out all the final details (options, pricing, delivery time, etc.). During the 30 days you can withdraw your letter of intent with no reason given. I cannot tell you how re-sales work.
It is near impossible for any realtor to know how all docs read. Do not trust their answers even when given. It is the buyers responsibility to verify. During my last sale of a private home in an HOA, there were several times I made a copy of portions of our docs (not the entire document) to answer a potential buyers questions.
.... Any other suggestions to avoid losing part of my EMD?
Prior to making any offer - talk to the HOA.
Covenants are often recorded; bylaws and such typically aren't. In addition to requesting bylaws and budget reports, always include and ask for the minutes for the previous 12 months or so, so you know what is being discussed, potential new policy/restrictions and special assessments. Never hurts to find out more about their insurance coverage too. Always check for any notices to current owner regarding their particular unit and/or building eg, painting etc, never assume the HOA is responsible for exterior condition etc ... all HOAs are individual. Common interest means the owners have equal share (use) and subsequent expense to 'something'...
As a Realtor representing a buyer, I have always taken it upon myself to provide the covenants/deed restrictions as recorded with my county and not relying on a seller's agent to do so. Typically that document can be a few dozen pages to a few hundred pages.
The HOA normally provides an abridged version of the HOA rules/bylaws at the closing. I agree with TarkaK9 that the buyer should reach out to the HOA directly ahead of time. A little research by the buyer can definitely prevent misconceptions or inaccurate information. Also, try to talk to some residents in the community if possible.
True, once OP is a buyer (rattified purchase contract). The HOA is not obligated to provide anything to lookers, however. They usually won't.
This is just wrong. Last year I signed up for condo listings with three separate RE agents in three separate areas, one area a half hour away from me, one 45 minutes away, and one an hour away.
It would have been either a vacation home or a future primary home that I'd rent out until we were ready to move, depending on the area. I was ready to buy.
The deal breakers for me are (1) pet policy, because I have two dogs and a cat; (2) if the HOA has an outdated, pre-internet policy about having a business in the home (I work from a home office and occasionally have a client at my home); and (3) fees.
I saw a condo in each area that I was interested in. I emailed Agent 1 about the one in her area; no response at all. I couldn't find any information online. Agent 2 called me to ask if I had found anything I was interested in. When I said I needed the above info, he gave me some BS about how the rules could change, so the best thing would be to come look. I found the info on the third condo online after a lot of digging, and discovered that they had a one-pet policy.
Why in Hades should I waste my valuable time traveling to look at a condo if there is a deal-breaker rule, or the fees are outrageous? Let alone get to the point of contract before I can find that out.
In this day and age, all of that should be made available electronically to everyone, even "lookers."
Edited to add: I just did an experiment, and it took me 30 seconds to email an attached PDF file, and 2 minutes to upload it to my website. There's no excuse for not providing the documents.
This is just wrong. Last year I signed up for condo listings with three separate RE agents in three separate areas, one area a half hour away from me, one 45 minutes away, and one an hour away.
It would have been either a vacation home or a future primary home that I'd rent out until we were ready to move, depending on the area. I was ready to buy.
The deal breakers for me are (1) pet policy, because I have two dogs and a cat; (2) if the HOA has an outdated, pre-internet policy about having a business in the home (I work from a home office and occasionally have a client at my home); and (3) fees.
I saw a condo in each area that I was interested in. I emailed Agent 1 about the one in her area; no response at all. I couldn't find any information online. Agent 2 called me to ask if I had found anything I was interested in. When I said I needed the above info, he gave me some BS about how the rules could change, so the best thing would be to come look. I found the info on the third condo online after a lot of digging, and discovered that they had a one-pet policy.
Why in Hades should I waste my valuable time traveling to look at a condo if there is a deal-breaker rule, or the fees are outrageous? Let alone get to the point of contract before I can find that out.
In this day and age, all of that should be made available electronically to everyone, even "lookers."
Edited to add: I just did an experiment, and it took me 30 seconds to email an attached PDF file, and 2 minutes to upload it to my website. There's no excuse for not providing the documents.
What do you mean by "wrong"? Ethically wrong or factually wrong? Because your story actually backs up my post completely.
Three different HOAs wouldn't give you docs as a "looker".
If an association/owner had to provide every tire kicker (especially online lookers) with a full set of docs, it could get time consuming plus expensive. I would expect a real estate agent to get me basic answers like say pet policy and if I liked the answer (especially if a deal breaker for me) then ask them for proof. The proof might be as simple as a one page copy of the docs concerning pet policy. Enough info to say well this place could interest me versus blow it off.
I do agree best for all if docs are online and available.
Kay:
You can expect issues about clients in the home. Running a business out of a home is one issue. Clients showing up is a horse of a different color. Be prepared for issues with this requirement.
What do you mean by "wrong"? Ethically wrong or factually wrong? Because your story actually backs up my post completely.
Three different HOAs wouldn't give you docs as a "looker".
"Wrong" in that if a house/condo with an HOA is for sale, the docs should be made available so that buyers can easily determine if it would be a waste of time to even consider the property.
BTW, it wasn't the HOAs that wouldn't give me the docs. I asked two RE agents. One never answered my email (even though it was in response to her email asking "See anything you like?"), and one wanted me to waste my time driving an hour to see a condo without knowing if there was a deal-breaker. (Guess which two agents I will never, ever use?) I researched online, found the info on the one that I didn't ask an agent about, and couldn't find the information on the two that I asked the agents about.
Quote:
If an association/owner had to provide every tire kicker (especially online lookers) with a full set of docs, it could get time consuming plus expensive.
How so? They aren't typing them with an IBM Selectric and carbon paper, are they? There's no need to print copies. This is the 21st Century. All these files are electronic. At the very least, the listing agent should have them and make them available via email or online. And "tire-kickers" can turn out to be buyers.
Quote:
Kay:
You can expect issues about clients in the home. Running a business out of a home is one issue. Clients showing up is a horse of a different color. Be prepared for issues with this requirement.
My clients aren't strangers off the street. I provide software training to a niche group of professionals. I only allow women I know personally to come to my home. It's no different than if two colleagues get together at one another's house. For all my neighbors know, I'm having a friend over for the afternoon. Usually I go to the client's home.
Although I would love to live in a community that has a conference room available for a reasonable price so I wouldn't have to clean my house.
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