Home Buying in 03815>Question Details

Jeanne0821, Home Buyer in 98103

What happens if the other side doesn't pay their taxes or the Insurance?

Asked by Jeanne0821, 98103 Fri Aug 20, 2010

My husband and I are looking to purchase a condex in Haverhill.

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3
Scott Godzyk’s answer
If you are looking to purchase say a condex, and there are only 2 units and the other side is not paying their share, you are opening yourself up into a huge liability and stress that you probabily could do without. First thing is usually there is a master insurance policy on the building, it is split bewteen the 2 owners, it could be paid yearly or broken down into monthly payments. If you have a mortgage the mortgage co will demand it is paid and you could be responsible for haveing to pay teh whole thing. Taxes are usually split between the 2 homes and get seperate tax bills, so their tasxes wont affect you. But there should be a long term reserve for say roof repairs or if a common septic and emergencies, that is why monthly payments are recomended.

If you do want to go forward you should have an attorney review the condo docs, rules and regs and financials of the condo associattion even if a 2 unit condo association made up of 2 condexes so you know what you are getting into.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Sun Aug 22, 2010
Hello Jeanne- Good question. I'm not a lawyer but I've been around the block a bit. I don't think you would be financially responsible for their bills/ escrows, etc.
Do you know if they have a mortgage on the place? If so, then most likely each month their lender is escrowing for all this so it should not be a worry.
Worst case--
The town can put a lien on their deed; their portion only- so that whenever the condex gets sold the prop. taxes must be paid first at the closing.
Insurance- that could be more complicated. Because the units are connected, I wouldn't be suprised if your insurance somehhow gets word that they are delinquent and that that half is uninsured. That could present a problem where your insurance company hikes up your rates- thru no fault of your own.
I would say that's all pretty unlikely though...
If you need any help, please let me know. Good luck,

Ken L.
0 votes Thank Flag Link Fri Aug 20, 2010
If there is equity in the home, the past due taxes and insurance would come out of the proceeds of the sale. If there is no equity, I wouldn't get involved because that would become a short sale.
0 votes Thank Flag Link Fri Aug 20, 2010
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