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Answers (7)
- Joe Zekas, "NewHomeNotebook"
- Contributions:362
I'm not following the solution, Sara.
No change in your contractual language would have any effect on the right of first refusal in a condo dec. The association would still have the right regardless of what your contract says.
No change in your contractual language would have any effect on the right of first refusal in a condo dec. The association would still have the right regardless of what your contract says.
- sara bonert, "Sara Bonert"
- Contributions:920
Thanks all. Ultimately it ended up being worth paying an attourney to right this language out of the contract.
- Connie Wildasinn, "Connie Wildasin"
- Contributions:1178
shop it out to a different mortgage broker...
- SoCal_Engr
- Contributions:5666
The wording being referenced is...
"The right of a unit owner to sell, transfer, or otherwise convey his or her unit in a condominium shall not be subject to any right of first refusal or similar restriction. It is recommended that the declaration affirmatively provide that a unit owner may transfer his or her unit free of any such restriction."
See Link to HUD/FHA Handbook 4265.1, Appendix 24 for more info.
Given that this is a HUD/FHA restriction, it seems possible that you could refi if it was not an FHA product (i.e., "private money" can do what it wants...more or less). However, so much is now tied back to govt backing or regs that even non-FHA products may have their hands tied.
Also, from what I have seen on Zillow discussions, it's possible that the only viable option is via FHA...due to LTV/credit issues.
Hopefully, a more informed mortgage-type can chime in and clarify if the restriction can be finessed by avoiding FHA products.
- Joe Zekas, "NewHomeNotebook"
- Contributions:362
It's common for condo declarations to give the board of directors of the homeowners' associaton a right of first refusal on the sale of any unit in the property.
The right must typically be exercised within 30 days of a contract being presented to the board for consideration.
The FHA refuses to insure loans on condominium units where the condo dec contains a right of first refusal, because of the potential for the right to be exercised in a discriminatory fashion. See, for further info:
http://www.fhainfo.com/condos.htm
The right must typically be exercised within 30 days of a contract being presented to the board for consideration.
The FHA refuses to insure loans on condominium units where the condo dec contains a right of first refusal, because of the potential for the right to be exercised in a discriminatory fashion. See, for further info:
http://www.fhainfo.com/condos.htm
- Larry Lowenthal, "Mr Ethics"
- Contributions:6
Sara,
Did you mean to type "Right of First Refusal"?
Did you mean to type "Right of First Refusal"?
- sara bonert, "Sara Bonert"
- Contributions:920
Sorry, I meant - this is preventing them from being to do a refi, not get a new loan, in case that wasn't clear.
"Rite of First Refusal" written into a Sales contract
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