Barry,

Austin is telling it like it is in easy simple terms. Yes the other owners have a say and can hold you hostage as per your TIC agreement. Read it again closely. Most recent agreements spell everything out!

It sounds like you have a complex lending situation and per your own explanation of lending situation it may serve you well to have a little patience with your co-owners. They should have the right to disapprove since you are not only a neighbor, but a co-borrower - sharing in equity the asset and liability package they call home with YOU.

BTW anyone reading this who is in a TIC - Check YOUR TIC AGREEMENT - if it's older than 2-3 years - YOU may wish to get it updated sooner than later.

You may wish to check out our newest TIC listings at 1288-1298 Treat Ave in the sunny Mission! Fractional financing and outstanding finishes!
http://www.GarfieldSquareHomes.com

All my best to you!

Mike Ackerman
Top Producer 2000 - 2008
Zephyr Real Estate - Noe Valley Office
ABZ@ZephyrSF.com
415-695-2715

Check out the links for TIC's below!

Hi Barry,

This sounds right to me. You are the only one who qualified for the loan and the only borrower, but all the owners will have to sign the deed of trust that acknowledges a loan is going on the property. This also gives the lender the ability to foreclose on the building if you default on the loan. I don't see anyway around this.

Your TIC agreement which is prepared by an attorney should spell out what happens in the event of a default to give the other owners protection. However, it's not a perfect situation. This is one of the downsides of a TIC. If the other owners are really giving you a hard time, putting up 3-6 months worth of mortgage payments in the reserve account may help give them piece of mind. This way if you start defaulting, they can continue to pay the mortgage while the issue is resolved among the owners.

Lastly, even if you get a Fractional TIC loan I still believe the other owners have some exposure because technically the deed of trust is still on the entire property.

you are at their mercy, whoever signs the document is liable.

thank you all. I have tried all banks that does fractional TIC. However, I was declined for one or the other reasons,(being a non-resident alien, been in US for only a few months, source of downpayment, all those small things, but in fact are blockers).

What I need now is a "loose" lender, but I think it is impossible for find one right now...

Hi Barry,
I think I know what is happening. All owners on the deed must be on the loan because you are all jointly and severally liable, meaning if one of you defaults, the lender can go after any or all of the others because you all own the building together. If you were the only one on the loan and did not pay it, the bank could not go after the other owners for payment unless they are on the loan as well.

You have to understand you are in business with these other owners, -------1 loan for 1 building. If you want a loan on your own, then you need a fractional loan where the others do not have to be on the loan. I don't know if lenders are doing fractional loans but the rates are higher, over 6.75% and you need 15% or more downpayment for a fractional loan.
If you want your own loan, you should buy a condo where you own it in its entireity.and can sell it whenever you want to.

I have more suggestions if you want to call me.... June David, Real Estate Loans, 415 242-1877

The information you are giving is a bit confusing. You applied for a group loan, but you are the only one on the loan? That doesn't sound like a group loan.

Then you say the loan documents require the other owners to sign the loan, but you haven't seen the document -- so how do you know the other owner's names are on it?

I would love to help you, but I would need you to provide clearer info!

This doesn't make any sense. If you are not going with a fractional loan provider, the other owners will have to sign and agree to encumber the property. I don't see how they can do that and not take on any liability. They'll have to sign AND they'll be liable. This sounds like a tricky situation.

You'll need to negotiate with the other owners. There will be resale ramifications. There's much to consider. It really does sound like you could use some assistance. I hope you'll consider interviewing agents with TIC negotiation experience.

Best of luck,

Jason Chapin
McGuire/Urban Bay Office
415-420-1143
jchapin@mcguire.com

Barry,

Your agent should be able to answer this for you. If you don't have one, contact me at one of the places below and I'll be glad to help you out. There are resale ramifications on the loan you choose so you want to be fully informed before you make a decision.

Regards,

Lance King/Managing Broker
415.722.5549
lance@fixedrateproperties.com