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Special Assessment right before closing, Need advice please

Buying a Condo in Hawaii, Sellers Disclosure said "Not to My Knowledge" in the Special Assessment section.  We are 3 days from CLOSING and my agent gets a letter from Seller's agent -- Special Assessment of $7000 per unit, due Jan 1, 2014. 
Elevators in building are always broken, letter states it take 20-30 minutes wait time to get up or down.   Whoa !!! 
My experience is I waited 10 minutes (that was awful in itself) and assumed it was Down temporarily due to maintenance.
IS IT REASONABLE for me to request they pay this Assessment or 
do a price reduction to cover the costs ? 
Cash deal, no loan, have met other contingenies, like I said we are 3 days from closing escrow. The had the letter in their hands since Oct 9 and waited over 2 weeks to present to my agent.     
Please advise,  thank you.
  • October 27 2013 - Waikiki
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Answers (5)

I agree, have your agent get closing to be postponed.  I find it hard to believe that this just "came up".

Based on the PC and your agents input it may well indeed to be prudent to ask for a reduction in selling price.  That being said ----you must ask yourself.

1. Can I live with shaky elevator service? Ask the other tenants if this is a common problem.
2. If the seller does not agree to the price reduction, is this a deal breaker and I walk?
3. Or, was this an attempt to hide a know issue? i hope not.
 
Your agent may recommend an attorney, I would.  If this was a known fact and it was withheld, oh boy your attorney will have big fun with this one.
ALOHA
 

   
  • March 15 2014
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Have your agent get an extension for the closing date until you can work this out.  Your sales agreement should cover this eventuality and give you guidance as to the options which can be taken.
  • October 28 2013
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well thats terrible, I would delay closing until I Sorted through everything
  • October 27 2013
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Aloha!
If your agent used the standard form, there is a section specifically for this situation on page four of your purchase contract (F-8 c.). It says that if a new assessment comes up between acceptance and closing, the buyer and seller need to make an agreement as to how the assessment will be paid. If you can't reach an agreement, the contract will be canceled. 

You purchase contract should also have a section that gives a time frame for when the seller must disclose new information (Page 6 I-1). If the seller didn't disclose the new information within that time frame, you have the right to cancel.

You need to decide if it is worth the extra $7,000 to get the deal closed. If the answer is yes, work with your agent to negotiate with the seller. There is nothing inappropriate about asking them to cover the full amount, but if you need to go into the discussion in the spirit of negotiation or you risk the seller canceling.

Hope this helps and good luck!




  • October 27 2013
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Profile picture for Outer Banks N C
That stinks. I bet they knew about it and didn't say anything and that is certainly a material fact. It takes some time to get quotes and figure out how much each unit owes to cover the costs. I would contact the condo management company and ask how long ago this was made known to the condo owners. It would seem your options will be to;

walk away

negotiate a new purchase price

continue on as if nothing changed

I would delay closing while you decide which should also help your negotiations.
  • October 27 2013
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