Before buying into a condominium or co-op, it is important to research the community association regardless if it is brand new or very well maintained in appearances.
The community association deals with day-to-day rules that affects the quality of life and community finances. Request for the board meeting minutes – keep an eye out for internal disputes between board members or management, financial numbers if discussed at meetings, compliance issues with the local agencies if any, and things that affect the annual budget numbers.
Sometimes community association could be sinking ships if it has been mismanaged for years. See if more than 15% of units are on the market, homeowners unable to pay their common charges, and lawsuits against HOA if any. Finally, review the reserve fund amounts, as mortgage lenders look at reserve fund amounts to make a lending decision. A loan can be denied or modified to a higher rate if the building reserves does not meet the percentage levels of the lender’s requirements.
Take time to attend an event held by the community association if there is one, there you may be able to strike up a conversation with a current owner to see how they like living in the community. Weigh all the information gathered from the conversation to see if the community is a good fit for your purchase.
Are there more owner-occupied units than renter-occupied units in the building? Owners care more about the building budgets and overall maintenance upkeep while preserving their home values.
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