Home Buying in Haverhill>Question Details

Jeanne0821, Home Buyer in 98103

What happens if the person on the other side of the condex doesn't pay both their taxes and the master Insurance? Will the town/ state come?

Asked by Jeanne0821, 98103 Fri Aug 20, 2010

after me?

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Scott Godzyk’s answer
Jeanne this is why all condos even condexes need to have an approved set of condo docs and rules and regulations which should outline this sitiuation. Master insirance and taxes should be paid monthly even if it is a condex. Also included should be an amount for long term maintenace such as roof replacement. If the other side is not paying and there is no payment structure set up, you will want to take your condo docs and rules and see a lawyer who specializes in this. You need to restructure your condo association from maybe nonexistant to something. The condo assoication, even 2 units can lien the other unit, if they have a mortgage, their bank will then get involved.

good luck with working things out
Web Reference: http://www.ScottSellsNH.com
2 votes Thank Flag Link Fri Aug 20, 2010
I own a condex and have the worst neighbors. Drums, surround sound and they don't help with shoveling or mowing lawns. There is no association. Do I have rights here?
0 votes Thank Flag Link Mon Feb 11, 2013
The good news about a Condex, is there are no condo fee's. The bad news about a Condex, there are no condo fee's. In most cases, it all works out. But, if your not fortunate enough to get a good neighbor, or that neighbor runs into tough financial times, then its a challenge. If its an existing home, then usually the curb appeal of the home is a good test as to what the neighbor is like. Also, there is no harm, and well advised to speak with the neighbor prior to making an offer. Most of us are good judge of characters. A 10 or 15 minute conversation about history and expectations is well worth the investment of time.
Web Reference: http://www.dmahoneyRE.com
0 votes Thank Flag Link Wed Jan 19, 2011
There's a lot of good answers here. The only thing I would add is that in the event that a condex neighbor isn't paying their share of the Master Insurance (if it's bank-owned for example), there are some insurance companies that can give full building (fire and liability) coverage to one owner so that they're protected. This doesn't help in a sale or purchase -- where a Master Insurance policy is 100% required -- but if you have to be liable for the entire premises, this option could save you up to $750/year.
0 votes Thank Flag Link Fri Aug 20, 2010
If you are contemplating purchasing a unit in a condex this is the time to ask the question. You have been given a lot of good answers for after the purchase. Many buyers like small condo complexes 2 to 4 units because of a low or no condo fee situation. And as you have aptly asked what happens if the other owner does not pay their bills? As you have learned real estate taxes are paid separately in all condo situations. But the common expenses must be paid by the owners as their percentage of ownership. Condex is typically 50/50 . So if you are buying get a copy of condominium documents and by laws, along with the budget, and operating bank account. If there is no budget and no condo bank account be careful in buying this property. Prepare to put aside enough money each year for reserves and the master insurance payment for the entire master insurance payment. If the other side stops paying you will have to pay for the policy yourself. At that point you would follow the condo by laws and lien the other unit for condo fee non payment; you would most likely recover the money owed on the sale of the other unit or a refinance. I doubt the banks would get involved unless the policy lapsed and the lender put forced insurance in place. This is not a situation you want to be in; the policy will be very expensive. This is why I advise to my buyer's shocked by the large monthly difference in condo fees that are found at professionally managed complexes; you get what you pay for. Would you rather pay more a month knowing there are large reserves and all the bills will be paid, even if some owners fall on bad times and can't pay the fee or small fee with no safety net. There is no right or wrong answer as long as you are aware of the risks and prepared to weather the problem financially. Always have a reputable real estate attorney review all the condo documents, by laws, budget etc prior to making any decision regarding this condo situation.

Best of Luck,

0 votes Thank Flag Link Fri Aug 20, 2010
You have already had some great answers below. Take action as soon as possible. Yes it could effect you.
0 votes Thank Flag Link Fri Aug 20, 2010
Good question - the town/state doesn't necessarily care, but your mortgage provider certainly does ! When you sign the paperwork at your closing, the forms state that you will continue to carry insurance on the property, and pay your taxes. Except in very rare cases, however, the taxes are included in your monthly mortgage payment and handled by the mortgage provider.

Even though there are only 2 units in a condex, you are still a part of a condo association, so if the other unit doesn't pay their half of the master insurance, you will also be liable since there is 1 bill split in half by both sides. If only half the bill is paid, the insurance provider won't insure half of the building! So you would have to pay for the other half, then try to get payment from the other owners.

Even if you don't get paid by the other owners right away, you eventually will because they cannot sell their unit or refinance if they have any outstanding bills (such as unpaid master insurance) so one day they will be caught up.

There are some downsides to buying a condo, but in the Haverhill area it's a great, affordable way to own your own home ! I specialize in Haverhill and the surrounding towns - iIf you're in the market I'd love to assist you with your search, please feel free to call or email me any time !

Lissa Deminie
Prudential Verani Realty
email: Lissa.Deminie@verani.com
Web Reference: http://www.LissaSells.net
0 votes Thank Flag Link Fri Aug 20, 2010
Hi Jeanne,
In your case it is more important that the master insurance gets paid in full. Not paying the taxes could only effect your neighbors property. You should reveiw your master deed/rules and regulations to find the exact way to handle the situation. If you are having trouble understanding them, consult a real estate attorney for advice. Feel free to contact me with any other questions. mgiles@kw.com
0 votes Thank Flag Link Fri Aug 20, 2010
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