Re: right of first refusal
From: Diana Carroll (dianaecarrollgmail.com)
Date: Thu, 5 Aug 2010 09:31:12 -0700 (PDT)
If you happen to know, who did your folks refinance with?

Our experience has been that individual banks who handle their own
loans ("portfolio loans") rather than resell them to Fannie Mae are
more flexible.  Unfortunately their rates are also not usually as
good.

- Diana

On Wed, Aug 4, 2010 at 11:38 PM, Mabel Liang <mabel [at] twomeeps.com> wrote:
>
> Here at Cornerstone Village Cohousing, Cambridge, MA http://www.cscoho.org
> , some folks have recently refinanced without any trouble.  And we do have
> a right of first refusal in our documents.
>
> Our Master Deed includes language (see below) which means that the right
> of first refusal does not apply in the case of a foreclosure, etc.  I
> don't know if that makes banks more comfortable.  The entire Master Deed
> is at our web site, for anyone who wants to peruse it.
>
> In addition, we have language which says "1.    the right to purchase is
> exercisable only as a means of insuring owner-occupancy of the Unit that
> is being sold, or for some other valid purpose that serves the best
> interest of the Association and its members;" plus "Moreover, such right
> shall not be exercised so as to restrict alienation, conveyance, sale,
> leasing, purchase, ownership or occupancy of units because of race, creed,
> color, national origin, sex, age or sexual preference."
>
> Also, we have the right to assign our right to purchase, so in practice we
> would most likely have someone on our waiting list purchase the unit as
> opposed to the Association doing so.
>
> My interpretation of our current policy does not allow a bidding war once
> the owner has agreed on a price and conditions.  There are those who
> either disagree or think it should be changed, saying that that's not how
> real estate deals work.  I include our current policy below, as well.
>
>
> ---------------
> >From the Master Deed:
>
> The Association will not have this right of first refusal with respect to
> any lease, sale or transfer of a Unit in connection with a mortgage
> foreclosure (or the acceptance of a deed in lieu of the foreclosure) or
> with respect to any sale or transfer by the mortgage holder or other party
> who acquired the Unit in connection with the foreclosure or deed-in-lieu.
> Such right of first refusal shall not impair the rights of a First
> Mortgagee to:
>
>                        (i)     foreclose or take title to a Unit pursuant to 
> the remedies provided
> in its mortgage; or
>
>                        (ii)    accept a deed (or assignment) in lieu of 
> fore­closure in the event
> of default by a mortgagor; or
>
>                        (iii)   sell or lease a Unit so acquired by the First 
> Mortgagee;
>
> ----------------
>
>> Cornerstone Cohousing
>> Unit Sale and Waiting List
>> Presented to General Meeting on March 20, 2004 by the Membership
>> Committee CONSENSED
>>
>> Rationale:
>> 1.  To outline the procedure to be followed when a unit becomes
>> available for sale and the guidelines for the Waiting List.
>> 2.  To support the seller in having her/his terms for the sale met.
>> 3.  To facilitate the identification of interested buyers/
>> prospective Cornerstoners who appear to be committed to the
>> Cornerstone vision.
>> 4.  To follow the precepts we placed in the Master Deed.
>>
>> Guidelines:
>> 1.  The seller or the seller's agent is to hand deliver a written
>> notice (not via e-mail) of intent to sell to the Chair, or Chair
>> designee, of the Cornerstone Managing Board and provide copies to
>> the board members (this can
>> be via e-mail).   This notice is to include the price and terms and
>> any
>> other special
>> circumstances, in keeping with Cornerstone's bylaws.
>> 2.  Within twenty-four hours the Chair of the Managing Board
>> acknowledges receipt of this notice of intent to sell and states the
>> time of receipt, which is the start of the 30-day review.
>> 3.  Also within twenty-four hours the notice of intent to sell is
>> sent out by the Membership Committee to the Cornerstone community
>> and the Wait List.
>> This will include (a) contact person; (b) the respond-by date; (c)
>> that a prospective buyer must include evidence of ability to finance
>> (e.g., a pre-approval).
>> 4.  Responses will be accepted through day 15 by the Membership
>> Committee.
>> 5.  Days 16 to 18 will be used to prioritize the responses.
>> 6.  Day 19 - 20 the first priority will be notified by the
>> Membership Committee.
>> 7.  The first priority person has from Day 21 - 25 to sign a
>> purchase and sale agreement.
>> 8.  The Membership Committee will work together with seller to
>> ensure that Waiting List members get to view the unit.
>> 9.  If there are no viable responses to this outreach by Day 15,
>> later responses will be considered until Day 30 but will not delay
>> seller from selling unit on open market after day 30. (1)
>>
>> Notes:
>> 1.  It is recommended that the seller (for her/his own benefit) not
>> sign an agreement with a realtor until the 30 days have transpired.
>> 2.  The Master Deed states that units are not to be purchased solely
>> for investment purposes.
>>
>> Priorities for Use of Cornerstone's Right of First Refusal (2) 1.
>> The first priority would be a current owner of Cornerstone if one
>> wishes to purchase the unit for sale on the seller's terms and thus
>> vacate her/his own unit 2.  The second priority would be Waitlist
>> Members who are current as of the start of the 30-day period, by
>> number.
>> 3.  Interested parties not on the Wait List.
>>
>> Waiting List:
>> A person may be on the Cornerstone Waiting List by meeting the
>> following
>> requirements:
>> a.  Expresses interest in Cornerstone and its Vision.
>> b.  Attends a general meeting or a Community meal and other
>> functions as possible.
>> c.  Pays $10.00 each year (after confirmation of continued interest)
>> to the Cornerstone Membership Committee.
>> d.  As of the date of the establishment of this Waiting List, any
>> people known to have previously expressed interested in Cornerstone
>> up to this date, will be notified to determine their current
>> interest in being on the Waiting List.  Those who respond back
>> within 30 days communicating their interest will be assigned a
>> Waiting List number by lottery.
>> e.  Subsequent interested parties will be listed according to when
>> their Waiting List fee is received.
>> f.  All resident non-owners interested in purchasing a unit should
>> be on the Waiting List.
>>
>> Footnotes:
>> (1)   If the transfer does not occur for any reason and the Unit
>> Owner shall
>> desire to sell the Unit at a lower price or on more favorable terms,
>> he shall notify the Board as set forth above; in which case the
>> Board shall have five (5) business days to notify the Unit Owner of
>> its decision.  This paragraph s shortened notice provisions shall
>> only apply within six (6) months of the original notice of intent to
>> sell.  (Cornerstone Master Deed)
>>
>> (2)  Section 17 of the Master Deed describes exemptions from the
>> Right of First Refusal as: excepted from the right of first refusal
>> shall be a conveyance or transfer to the Unit Owner s parent, child,
>> sibling, spouse or to a domestic partner as defined in City of
>> Cambridge Ordinance Chapter
>> 2.119 as existing on the date hereof; and Units restricted under
>> Section 11(b).  Moreover, such right shall not be exercised so as to
>> restrict alienation, conveyance, sale, leasing, purchase, ownership
>> or occupancy of units because of race, creed, color, national
>> origin, sex, age or sexual preference.  A transfer by will or
>> intestate succession shall not be covered by this Section.  (3)
>>
>> (3) Please note that the transfer itself by will or intestate is not
>> subject to Cornerstone s right of first refusal.  However, if
>> inheritors sell the unit, they are subject to Cornerstone s right of
>> first refusal.
>
> -- Mabel :-)
>
> Mabel Liang
> mabel [at] twomeeps.com
> Software Engineer turned Gardener
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