Condominiums are one of the common options people explore when looking for a place to purchase in the New York City area. Many people don’t realize that some considerations for condos aren’t present for other types of real estate.
One of the primary concerns for most people is whether they’ll qualify for financing or not. Qualifying for a condo to be financed is much more involved than owning a single-family home. The terms of lenders might be vastly different.
While it varies from one lender to another, most require that the borrower is going to live in the condo. They may even require that a specific percentage of the condos in the building are owner-occupied and that a specific percentage have already been sold.
The loan-to-value ratio might be different for condos, which could require you to put down a larger down payment. The is the relationship between how much you owe on the condo and the value of the condo.
When you’re reviewing the paperwork for the condo, you need to ensure you read over the covenants, conditions and restrictions, which are commonly referred to as the CC&R. this outlines what you’re allowed to do in the condo. Violating any of the terms could lead to fines or being sued.
You also have to check the monthly fees, or Homeowners Association fees, that you’ll have to pay for living in the condo. This amount is on top of the mortgage payment. It covers things like keeping up with common areas, as well as the amenities that are offered to the condo’s owners.
You’ll also be responsible for paying for insurance and taxes on the property. Repairs to the interior of the condo will also be your responsibility, so you must ensure that you have the money available to handle those additional expenses when they come up.
Making sure you review the contracts is imperative when purchasing real estate. Having someone on your side who can look over things for you can take some stress out of the process.