<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:</font><HR>Originally posted by rflyer:
I am trying to sell my condo but my Association is sueing a sub-contractor who built some of our condos. I do not have the problems related to the lawsuit but I have heard that buyers are not being able to get financing to buy condos in my complex. I am part of the lawsuit since I am in the same complex. How hard is it for buyers to get financing and are certain types of financing better. (FHA, etc..) I am close to closing on another property and will be losing money keeping my condo. My condo just went into escrow and I am worried if it will go through. Please help.<HR></BLOCKQUOTE>
The upside is that the Association is not the one getting sued. Depending upon the details of the lawsuit ie. dollar amount of the claim, chances of prevailing, how soon can the suit be settled etc. there may or may not be a big problem. If the sub was supposed to install 25 fire extinguishers and they installed only 19, no biggie. If the sub was responsible for any foundation, structural, roofing, waterproofing or major systems work, that may be a bigger claim. Usually the prime general contractor gets sued also.
In this type of situation, the lenders legal counsel talks to the attorney for the Association to get the scoop. In most cases the lenders counsel writes a legal opinion that he has reviewed the complaints etc. and it is his/her opinion that financing of the property would not place the lender in a precarious position. Sometimes a bond is required.
You really need to get the details of the lawsuit from the Association. In the event that no lender would finance the property, you can still sell under an owner financing type plan ie. have the Buyer assume the mortgage, take back a 2nd mortgage, sell under a land sales contract, lease option with large down etc.
