newinvestor
Junior Member
What is the name of your state (only U.S. law)? CA
We are in the process of getting financing for a 7-unit apartment building. Since we are new investors, the lender requires us to sign a 1-year agreement with a professional management company. Since this is a small property, we would like to manage it ourselves and save the 5-6% management fee. A colleague who owns a property management company said that she could execute the 1-year agreement with us, and at the same time, sign a letter to nullify the agreement. The idea is to sidestep the lender's requirement. Two quesitons...
1. Would the subsequent letter actually nullifies the management agreement?
2. Would we get into trouble with the lender if they found out?
Thanks!
We are in the process of getting financing for a 7-unit apartment building. Since we are new investors, the lender requires us to sign a 1-year agreement with a professional management company. Since this is a small property, we would like to manage it ourselves and save the 5-6% management fee. A colleague who owns a property management company said that she could execute the 1-year agreement with us, and at the same time, sign a letter to nullify the agreement. The idea is to sidestep the lender's requirement. Two quesitons...
1. Would the subsequent letter actually nullifies the management agreement?
2. Would we get into trouble with the lender if they found out?
Thanks!