"If I had only known how many problems there would be in my condo building, I never would have bought a condo!"

Does this sound like you? Unfortunately, this is a common refrain among condo owners. Condo living is complicated and confusing at times, and conflict is inevitable. Condo owners who look forward to owning property, building equity and being able to make alterations that aren't possible when renting often find that condo living isn't quite what they'd expected.

Sometimes, you just need someone to listen and sympathize. Sometimes, you need someone to give you guidance on how to tackle your condo conundrums. Sometimes, you need both.

On Wednesday, July 19th, CCR will be hosting a "Condo Therapy" session with the Experts. Come for FREE food, drinks and advice from industry leaders. This is an opportunity to connect to solutions and to other condo owners who can relate.

Details on our Calendar. Please spread the word!

We've long held that the magic number for passing an amendment to a condominium association's governing documents is 2/3 of unit owners, unless the governing documents state otherwise, except that no more than a 3/4 vote can be required.

The IL Condo Act states: 27. (a) If there is any unit owner other than the developer, the condominium instruments shall be amended only upon the affirmative vote of 2/3 of those voting or upon the majority specified by the condominium instruments, together with the approval of any mortgagees required under the provisions of the condominium instruments, except in cases where this Act provides different methods of amendment or with respect to property whose declaration is recorded on or after July 1, 1984, no condominium instrument shall require more than a three-quarters vote of unit owners to amend the bylaws. Except to the extent authorized by other provisions of this Act, no amendment to the condominium instrument shall change the boundaries of any unit or the undivided interest in the common elements, the number of votes in the unit owners' association, or the liability for common expenses appertaining to a unit.

However, a strict reading of this section would indicate that the 2/3 applies to "those voting" and not "all members." 

If the association's governing documents do not specify otherwise, a condominium association could conceivably pass an amendment with far fewer than 2/3 of owners voting in favor. Per the IL Condo act, 20% of owners constitutes a quorum (the minimum number required to hold a vote) and if 2/3 of "those voting" vote in favor, an amendment can pass.

The operation of your association is largely dependent on your individual governing documents. It's important to review your Declaration and Bylaws and potentially have them clarified by a condo attorney to ensure that you are operating properly, particularly in regards to a major change such as an amendment to the governing documents.

Condo purchasers looking to benefit from low down payment FHA insured mortgages currently must buy in condo buildings that are FHA certified. The process of obtaining FHA certification can be time consuming and the certification must be renewed every 2 years. Many condo associations do not bother with FHA certification, which means that the pool of eligible buyers shrinks for sellers in those associations. In fact, it's estimated that fewer than 7% of condo buildings carry this certification.

FHA certification for the entire building was not a requirement prior to 2010, when stricter policies were put in place as a result of FHA losses in condo buildings from fraudulent mortgages. Until then, lenders used the "spot" loan approach to qualify FHA-insured mortgages in condo buildings that were not FHA certified as a whole.

A return to spot loans could benefit both condo buyers and sellers by increasing financing options, but lenders will still need to adequately review the condo association's financial stability, which could mean a lot of red tape.

Read more about potential changes to FHA loans for condo buyers here.

While the foreclosure crisis has slowed down and most condo buildings have stabilized, many associations continue to face foreclosures. If there are owners in your building in foreclosure who are also delinquent on assessments, it's important for your association to understand what must be done to minimize financial loss.

When a condo owner forecloses, the balance on that owner is wiped clean, and the bank becomes responsible for assessments going forward. However, IL condo law allows the association to collect a portion of that owner's unpaid balance if certain legal actions are taken before the foreclosure concludes. The condo association can collect unpaid assessments charged in the six months prior to taking legal collection action, plus the legal fees and costs associated with that action, from the third party purchaser of the unit at the judicial sale or after foreclosure.

Though the timeline for a foreclosure to be completed is affected by a number of factors, in general you can expect a foreclosure to conclude within about a year of the initial filing. If your association gets notice of a foreclosure and the owner is delinquent on assessments, you'll need to take action during that time.

Haus Financial Services can help your association to create an Action Plan for addressing foreclosures on owners with delinquent accounts. Contact us today!

The community living aspect of condominium ownership brings with it a huge potential for conflict. Conflict can occur between owners, between the board and owners, and even between board members. And while conflict is as inevitable in condo living as it is in all areas of life, it can be managed successfully with the right approach.

Often, conflict is the result of differences in how people live and an inability to come to an amicable compromise. In our experience, it is often helpful to bring a third party into the conflict to help both sides come to a workable resolution. Using a mediator can help your association to minimize legal bills and time in court, which can often inflame the problem and make living in your condo even more unpleasant.

The Center for Conflict Resolution in Chicago offers FREE mediation services that can help condo owners to better navigate their disagreements. Training services are also available for individuals looking to learn the skills of successful negotiation and compromise. Legal action is expensive - try a mediator first!

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