Re: Fannie Mae | <– Date –> <– Thread –> |
From: Diana Carroll (dianaecarrollgmail.com) | |
Date: Wed, 4 Aug 2010 10:17:14 -0700 (PDT) |
I've been working with banks on mortgages a LOT lately and banks are VERY cautious when it comes to anything that might potentially get in the way of their ability to do exactly what they want, when they want. Consider this scenario: - buyer makes offer, offer is accepted by seller. offer includes 6 weeks to close. - HOA exercises their right of first refusal - after 6 weeks, HOA fails to close - original buyer has long since moved on to another property, no sale goes through Heck, consider even worse: the HOA does NOT want the property sold for some reason, and repeats the above on multiple occasions. What happens then? - seller gets frustrated and stops paying the mortgage Is this likely? From the bank's perspective, yes. Condos (and worse, coops) were hit disproportionately hard by the recent mortgage collapse, and one (smallish) part of the reason was because of HOA restrictions on selling. Banks are very jittery around condos these days, and will walk away from mortgages that look even a LITTLE iffy. It's helpful to think of things from the banks' perspectives. They don't know anything about cohousing. They don't know anything about your HOA. They need policies that protect them risk. This is true of individual banks and even MORE true of Fannie Mae, which absorbs the risk without getting any say in which mortgages are accepted other than through the "brute force" mechanism of a mortgage acceptance checklist! - Diana On Wed, Aug 4, 2010 at 12:01 PM, Sharon Villines <sharon [at] sharonvillines.com> wrote: > > > On Aug 4, 2010, at 11:46 AM, Michael Barrett wrote: > >> So I tentatively surmise: >> If an offer is received from a buyer who apparently has no interest in >> supporting and participating in the community, then the right of first >> refusal allows the HOA to match that offer and buy the property? >> Is that so? > > Yes. > >> And do so repeatedly if the unwanted buyer ups their offer? > > The time period would start with a contract between the buyer and > seller so the seller would have accepted the price. Then the HOA has > the right to match that price. > >> If so then the mortgage-offering-bank will want to be sure the HOA >> is a good >> risk. Is it that banks like named individuals with good stable jobs >> and >> excellent credit rather than paper organizations? > > The HOA would be the official buyer and either use it's own funds to > buy or apply for a mortgage as an HOA. In the one instance in which > some residents would have tried to finance a purchase, they would have > had to loan or give the down payment to the HOA or convince the HOA to > use its own funds to purchase. > > We have some very fiscally conservative members so it is unlikely that > any of these things would happen in 3 days but in case of emergency, > one never knows. What we really need to do is to investigate the > possibilities now so we are ready if this occurs again, but...... > > Sharon > ---- > Sharon Villines > Takoma Village Cohousing, Washington DC > http://www.takomavillage.org > > > > > _________________________________________________________________ > Cohousing-L mailing list -- Unsubscribe, archives and other info at: > http://www.cohousing.org/cohousing-L/ > > >
- Re: Fannie Mae, (continued)
- Re: Fannie Mae Ann Zabaldo, August 4 2010
- Re: Fannie Mae Michael Barrett, August 4 2010
- Re: First right of refusal Racheli Gai, August 4 2010
- Re: Fannie Mae Sharon Villines, August 4 2010
- Re: Fannie Mae Diana Carroll, August 4 2010
- Re: Fannie Mae Sharon Villines, August 4 2010
- Re: Fannie Mae Sharon Villines, August 4 2010
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