What does the Seller have to provide to the Buyer when selling a condominium?

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When selling a condominium unit, what does the Seller have to provide to the Buyer, and how long does a Buyer have to cancel the contract after receiving the information? It depends on whether it is an initial sale (from developer/declarant) or a resale (any seller other than developer/declarant).

 

INITIAL SALE OF A UNIT (Developer/Declarant to first unit owner)

Seller must provide Public Offering Statement that includes:

  • Condominium Declaration.
  • Articles of Incorporation (or other document that creates the association).
  • Bylaws.
  • Copy of any lease or sublease relating to the condominium property, if any.
  • Statement whether the management of the condominium has been contracted out to a third party, and if so, the statement must include:
    • the nature of the services to be rendered,
    • the duration of the contract including renewal provisions,
    • the cost to the association of services rendered, and
    • whether the management company or person has any relationship to the declarant/developer.
  • Projected budget for the first year.
  • Brief narrative of the significant features of the Declaration, other than the items already on this list.
  • Diagram or other illustration of the floor plan of the unit.
  • Statement whether unsold units will be exempted from paying for common expenses, and the duration of that exemption.
  • Statement that purchaser has fifteen days after receipt of the public offering statement (but before conveyance) to cancel the purchase contract.
  • Terms of any warranties expressly made or limited by seller/declarant.
  • Statement of unsatisfied judgments against the association and status of pending litigation to which the association is a party.
  • Description of the insurance coverage provided for the benefit of the unit owners.

If the development has greater than ten units, it also must include:

  • Report by architect or engineer describing the condition of roof, structural, mechanical, and electrical components of the condominium.
  • Statement by declarant/seller of the estimated remaining useful life of the roof, structural, mechanical, and electrical components described in the above report.
  • Statement of outstanding violations of building codes or municipal regulations, together with the estimated cost of curing those violations.

Buyer has fifteen days from receipt of public offering statement to cancel the contract, unless the sale closes before the fifteen days have elapsed.

 

RESALE OF A UNIT (Any sale after initial sale)

Seller must provide:

  • Condominium Declaration.
  • Articles of Incorporation (or other document that creates the association).
  • Bylaws.
  • Certificate (from the association) containing:
    • Statement of any current common expense assessment,
    • Statement of any capital expenditures approved by the association for the current year and for the two following years,
    • Statement of the amount in reserve for capital expenditures, including any amounts earmarked for specific projects,
    • Most recent balance sheet of the association (income/expense sheet), if any,
    • Current operating budget, if any,
    • Statement of unsatisfied judgments against the association and status of pending litigation to which the association is a party,
    • Description of insurance coverage provided by the association,
    • Statement of remaining term of any lease affecting the condominium property, including description of renewal provisions, if any,

Here, the “Certificate” with the items listed above shall be furnished by the Association within ten days of the Seller requesting it. This ten-day period only pertains to the condo association’s obligation to furnish the certificate and is separate from the five-day period described below.

For a resale, Buyer has five days from receipt of the above information to cancel the contract, unless the sale closes before the five days have elapsed