Selling a condo isn’t a simple process, and a homeowners’ association can make it more difficult. Read up on these common roadblocks so that you can make sure you don’t stand in the way of any of your residents making a sale.
Once a condo is in escrow, the HOA or property management company will complete a condo cert for a lender. This is where information that can hold up the sale may come to light.
If one person owns more than one unit, lenders get nervous. If that one person has financial trouble, it can cause problems with several units and put the financial health of the whole property in jeopardy.
Lenders also hate to see an out-of-balance tenant to owner ratio. The assumption is that owners take better care of the property than renters, so lenders like to see more owners than tenants in the property.
Lenders want to make sure the HOA is financially stable. If it isn’t properly insured or if there isn’t enough money in a savings account to take care of property repairs, lenders will be uncomfortable.
If lenders see one of these problems on your condo cert, they could slow down the sale or refuse the loan. Don’t put a resident in this position. Instead, be sure that your association and your property are in good financial health for the good of all your residents.
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