Developer going broke?

[315Arch]

What is the name of your state? Pennsylvania

We're in a 52 unit in Philadelphia that was converted into condos in early 2006. The condo docs call for a Condo Association to be formed when 75% of the units are sold; right now we're just over 50% and the market has tanked, so it will probably be a while before we take over. The problem is that we're hearing that the developer is going broke and may go into foreclosure. Apparently the utility bills haven't been paid, and the management company just pulled out.

What protection or recourse do the current owners have? Can our water and electric service be cut off for lack of payment, even though all the unit owners have kept current? What does the PA Uniform Condominium Act have to say about it (just got it, haven't read it, and I don't have a legal background so I'm not sure I'll understand what I'm looking at). If the developer forecloses, can we form a condo association at that point even though we haven't reached the 75% point? Should we? Any knowledgeable replies are appreciated.What is the name of your state?

[HomeGuru]

Originally Posted by 315Arch

What is the name of your state? Pennsylvania

We're in a 52 unit in Philadelphia that was converted into condos in early 2006. The condo docs call for a Condo Association to be formed when 75% of the units are sold; right now we're just over 50% and the market has tanked, so it will probably be a while before we take over. The problem is that we're hearing that the developer is going broke and may go into foreclosure. Apparently the utility bills haven't been paid, and the management company just pulled out.

What protection or recourse do the current owners have? Can our water and electric service be cut off for lack of payment, even though all the unit owners have kept current? What does the PA Uniform Condominium Act have to say about it (just got it, haven't read it, and I don't have a legal background so I'm not sure I'll understand what I'm looking at). If the developer forecloses, can we form a condo association at that point even though we haven't reached the 75% point? Should we? Any knowledgeable replies are appreciated.What is the name of your state?

**A: you need to get together with the other owners and form an ad hoc HOA, then hire legal counsel. Utitlity and other services can get cut off for non payment by the Developer so the side HOA should be able to pay into an escrow account and have escrow pay the utility bills. If the developer goes belly up, it will be a huge mess.