Before You Represent a Client on a
Condo or Townhome Property ...
Agents: Do you know what the correct answer is for this question?
What is the difference between a Condo and a Townhome?
A simple answer would be:
The #1 defining difference between the two types of properties is: OWNERSHIP RIGHTS.
It's not about style. Or about design. It's not about appearance or physical characteristic comparisons either.
Now I know what you're thinking. Gene ... really? Another post on condos and townhomes??? But to my defense, I've had a number of recent calls from agents that clearly showcase the need to address this topic. And I think the topic to be that important.
Plus, if you've been in the Real Estate or Lending Industry very long, you know nothing is as simple as the answer I provide above.
So ... how do you seek and find a definitive answer to the question above? What's the difference?
If you're a Listing Agent: It's important to obtain the documents and info shown below from your Sellers. That way you know legally what type of property you're listing for sale ...
- A copy of the Tax Bill
- A Survey (if one exists)
- Declarations or Bi-Laws
- Homeowners Association Name
- If a Management Company is involved: Obtain their Contact Name and Contact Info
- A FULL Legal Description (available on a Title Policy, Mortgage, or other Closing Documents)
If you're a Buyer's Agent: Reviewing the Listing Agreement for the following indicators will be of great benefit to you and your client:
- Property Type (is CONDO Referenced)
- HOA Dues (typically higher with condos)
- Property Index Number (PIN) - can provide clues
Also important for Buyer's Agents: Acquiring the Legal Description of the property being considered for purchase. Within that Legal Description you'll find valuable info.
Look for these "clues" and terminology within a property's Legal Description:
If the Legal Description refers to Condominium within the language of the document, it will ... 99.9% of the time ... be a Condo. (Wondering about the other .1%? Contact me.)
If it refers to PUD (Planned Unit Development), Townhouse Association, etc. ... you have a property NOT considered to be a Condo, but rather a Townhouse.
I urge Buyer's Agents use the following BEFORE showing a property ... and most definitely BEFORE writing a Contract:
- Local MLS
- Recorder's Office - Website
- Treasurer's Office - Website
- Your Preferred Lender
- FHA and VA Websites
... to definitively discover the type of property being considered. Why??
Property type determines: Not only the type of Mortgage Programs available to your Home Buyers, but their eligibility for varying financing options too. (Not to mention higher rates or closing costs in the case of some condominium scenarios.)
As I've mentioned in many previous posts, choice of Mortgage Lender matters greatly. That's especially true when representing clients considering the sale or purchase of Condominiums and/or Townhomes.
Working with a Mortgage Lender that has knowledge, experience, and success in Closing these properties is vitally important. Refer wisely ...
* Have clients in need of mortgage advice or service in the Greater Chicagoland area? Contact me. I'll put my 37 years of mortgage experience, knowledge, and expertise hard to work on your clients' (and your) behalf.
I can be easily found at:
Gene Mundt, Mortgage Lender, a Lender with 37 years of mortgage experience, will offer you exemplary mortgage service and advice when seeking: Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago and the greater Chicagoland region, including: The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena, Manhattan, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook, Romeoville, Naperville, etc.), DuPage County, the City of Chicago, Cook County, and elsewhere within IL.
Your Referrals are Greatly Appreciated!