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08/25/2009 15:36:05
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Subject: Limits on owner/renter ratios and current lenders
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Ronald Clark
Joined: 08/25/2009 15:14:55
Messages: 2
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The Board of Directors of the community I manage is currently reviewing 2 hardship requests to override the current lease permit waiting list and allow 2 units in the building to be rented. However, there is a limit to protect value of the building (and its residents) that no more than 20% of the building may be rented out to non-residents. The B.O.D. for the HOA would like to know if they grant one or both of these cases- will lenders be less likely to favor units that are for sale or applying for refinancing. How should I advise my B.O.D.? We are a 70 unit luxury midrise condo building in a central and affluent part of the city, with only 6 units up for resale and no foreclosures to date.
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04/17/2010 21:03:26
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Subject: Re:Limits on owner/renter ratios and current lenders
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Eric Orsbon
Joined: 04/02/2010 10:23:32
Messages: 13
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Looks like no one had an answer for this one! I'm sure you've already done something on this, but my suggestion would be to ask a lender or two? Also, I'm not sure how they would know how many renters were in the association. And my gut feeling is they would not forwn upon it being slightly more than 20% if you are saying it would be.
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08/04/2010 10:44:09
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Subject: Re:Limits on owner/renter ratios and current lenders
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Derek May
Joined: 05/03/2010 21:42:44
Messages: 1
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I know Eric and I are commenting on a relatively old thread here but thought it would be a good idea to post my experience with this very topic. First, let me say that I too began scouring forums looking for the very same answers simply due to the fact that I hear many different requirements from many different lenders and while most restrict rentals between 10 and 20%, I have yet to find any solid factual data. I oversee the day-to-day operations of roughly 15 common interest developments and this is becoming more and more a topic of debate among Boards that I interact with.
What is everyone else's experience with lender owner/renter ratios?
S. Derek May
Meridian Realty Services, Inc.
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08/17/2010 16:47:01
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Subject: Re:Limits on owner/renter ratios and current lenders
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Lori Burger
Joined: 09/15/2008 19:57:58
Messages: 75
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Ron,
I understand your delimma. Unfortunately, the Association has governing documents which the Board must abide by. Failing to comply with the governing documents could cause a lawsuit being filed by one (or more) of the objecting homeowners, homeowners could call for a board recall or a number of things. Time is most likely of the essense and there's probably not time to get an amendment to the governing documents to increase this number.
My opinion would be for the Association to consult with counsel on this matter.
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