Effects of construction defect litigation on CONDO LOANS
Condominiums have proliferated in the Charleston area over the last two decades, both through conversions and through dedicated new construction. Some of these projects seem to be plagued by construction defects that have resulted in repair assessments to unit owners and in construction defect litigation by HOAs seeking to recover for the fallout associated with the defective work on behalf of affected owners. Outstanding and potential repair assessments are often a focus of condo sales transactions. However, an often overlooked aspect of this litigation is the impact that it has on the ability to obtain conventional financing or to refinance a loan once you own a unit.
Below is a link to an interesting story by the Post & Courier in Charleston regarding the impact of construction defect litigation in condominiums on the financing of sales and refinance transactions for individual unit owners and purchasers.
The article points out several of the problems that can arise with condo purchasing or ownership and highlights some of the reasons that condominium owners and buyers should be diligent in obtaining the best information possible when engaging in a transaction involving a condominium and seek advice from trusted and knowledgeable sources when there are questions related to construction defects, assessments, disclosures, or other related issues.
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The above information is provided for the reader’s general knowledge only and is not intended to be legal advice for anyone’s particular situation. The law is ever-changing, and different circumstances may require the application of different law or result in the above guidelines being irrelevant. If you have legal questions related to this content, you should consult an attorney of your choosing for advice regarding your individual situation.
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John Townsend Cooper is the attorney responsible for this content. His office is located at 1476 Ben Sawyer Blvd., Mount Pleasant, South Carolina 29464.
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