I've had people petition the Board numerous times and get their hardship rental approved. If this does not work, she should consider a short sale, and try to sell the condo. She most likely will qualify for a short sale with a financial hardship of not being able to pay her mortgage here in ATL and pay rent in Florida.
Should the number of investors exceed to allowable limits, then none of the units will be eligible for traditional financing until the number is renters is brought back in line. That move then impacts every single owner within the project who is trying to sell or refinance. The HOA boardâ€™s first and foremost responsibility is to the overall project and not to a specific owner. At closing, every owner has to acknowledge being bound by the HOA covenants.
Thom is correct that your friend can see if a hardship waiver can be granted. HOAâ€™s do have to be very careful when considering those. As Sally mentioned, most every HOA maintains a rental list for the owners. Checking on that will let them know how many owners are ahead of her waiting to rent their unit.
Rodney Mason, NMLS #151088
Sr Loan Officer
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
Apply Online at http://www.rodneymason.com
Licensed in Alabama & Georgia
Your friend needs to meet with a real estate attorney to see what needs to be done with the lease. She also needs to meet with the board to find out how many are ahead of her in the rental list.
The board cannot be threatend that she will let the unit go into foreclosure to get them to ignor the covenants and restictions. The ramifications of esceeding the 25% cannot cause more damage to the overall than a foreclosure.
Sally W. Hamby
Senior Mortgage Banker
Fidelity Bank Mortgage
404 644 7696
Best of luck!
Keller Williams Realty
That tenant should review the Georgia landlord / tenant laws - she should have decent expectations.
Your friend has run awry of the HOA do-gooders in that building who are enforcing a bylaw that she must abide by. If she took the step of applying for a hardship, and was denied, then that would be another issue - regardless, she is out of favor with the bylaws.
And, in Georgia it seems that HOA bylaws in general are strict like that, and the 25% rule is based on FHA mandates - I have noticed that all across Florida, the rules are completely different.
One of my potential clients is a multi-national investor who I met here on Trulia - we drove around last month for a few hours looking for "landlord buys.' Their intention in Georgia is to replicate their successful investing model - a model that works quite well in Florida and Brazil, and that has been in place for over a decade.
He wants to buy tenant ready, landlording unrestricted properties at value price points, fix them up for the highest and best rental rate, make sure that they are in communities that have excellent fundamentals then flip them to a buy and hold, conservative investor who likes a steady ROI.
He's not sure about how well he can do in Georgia, because our HOA's don't play, most of the time, nowadays. 1+ year long waiting lists for a landlord privilege are the norm nowadays.
Just look at what has happened in Midtown and Virginia Highland and other Intown neighborhoods, or all over the suburbs - with values dropping by greater than 50% and up to 90% in some buildings and communities in just 5 years, well lawlessness can occur - desperation, distress, and decision-making that sometimes goes against the establishment.
As such, FHA won't touch it.
As such, the best associations in Georgia are pushing back against those who do not abide by their covenants, conditions, restrictions and easements and in doing so they are doing their damndest to protect value.
If the tenant/purchaser fails to continue making payments they default and do not get title to the property.
Would be like owner financing, but there are risk with giving someone ownership interest in a property, consult with an attorney.