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BUYING A HOME -
Most of the steps in buying a condominium are identical to buying a house. However, when buying a condominium keep in mind that ownership of a condo is “shared ownership” which entails some special considerations. Make sure to consider the following before buying a condominium.
1. Make sure you understand what you will be required to pay in maintenance costs and/or monthly homeowners association fees. Also inquire if there are any special assessments expected in the near future for items such as emergency repairs, a shortfall in monthly dues or even litigation costs.
2. Check to see if the condominium building or complex has a high proportion
of unsold or empty units that may hurt resale prices. Beware that some developers
may advertise that a building is 70% sold when in actuality the 70% sold represents
only units released for sale, and not all the units in the building. Also check
to see if the condominium has a large number of investor-
3. If you are buying a condo in a new building or complex make sure you look into the reputation and financial condition of the developer. Also ask that any deposit you put on a unit under construction is kept in an escrow account in case the builder defaults. However, keep in mind that in some states the developer is permitted to use some of your deposit money for construction and this will be lost if the developer goes bankrupt.
4. Make sure you get a copy of the condo’s rules, covenants, conditions and restrictions documents and read them carefully. You will be required to abide by these rules and costs.
5. In most states, if you are buying a new condo from a developer you will have a grace period of several days to reconsider your purchase after contract signing and to back out of the contract if you so decide.
6. Keep in mind that when you own a condo you may be responsible for damages that are not caused by you. For instance, in most instances, if the condo above your unit has a water leak (say a burst pipe) and the water causes damage to your unit, you are responsible to fix you own unit. The owner of the unit with the leaky pipe is not responsible. Also, if a storm, fire, etc. damages the condo building or complex you will have to pay your share of any uninsured damages, even if your unit was not damaged. Remember, shared ownership means shared responsibilities.
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