Are you considering a condo for your next real estate purchase? If so, you are more than likely well aware of the fees that come along with it. Condo fees are how the building pays for maintenance, repairs, and shared areas of the building, so they are not necessarily a bad thing. However, there are a few things that need to know when it comes to condo fees.
Fees Could Change
The fees that you agree to when you purchase your condo will not always be the fees that you pay when living there. Condo fees are allowed to change over the years for various reasons. Typically, it requires the condo owners to show that the increase in fees is necessary to cover necessary costs related to the building.
In addition, you could be charged with a special assessment for an emergency repair that the general condo assessment fund cannot cover. Before you buy, be sure to look at meeting notes to find out how much the condo fees have been raised over the years, as well as much much money is in reserve for special assessments.
Condo Fees Should Be Equal Among Tenants
When it comes to the actual condo fee for each unit, don't be surprised to see different units in the building with different fees. It is common to decide on condo fees based on the square footage of each unit, no equally dividing it across each unit. This means that the units that take up more space in the building will need to pay for more of the shared services. Be cautious when every single unit has the exact same fee.
Legal Action Can Be Taken Against Tenants That Don't Pay Their Fees
You are legally bound to pay for the condo fees when you purchase a condo. If you do not pay them, the owner of the building could sue you and have a lien placed on your property. You'll be unable to sell the condo to another person until all unpaid fees are paid. Because of this, it is possible that your escrow company will request any fees along with your mortgage payment when putting money into escrow.
Even though you are legally obligated to pay your condo fees, these fees can't be counted as a tax deduction like mortgage interest is counted.
For more info about condo and fees, speak with a real estate agent. You can also visit websites like http://www.leathermanhomes.com.