Refinance Mortgage HOA litigation

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Questions>HOA litigation

I am refinancing a condo (or townhouse or PUD) and am aware that our HOA is currently in litigation with the developer. Will I be able to refinance my mortgage?

A Homeowner's Association could leave itself open for legal action if it doesn't act on legitimate building defects and disclose these defects to all unit owners. However the fact that an association is suing a developer can impact an owners ability to obtain financing. It is vital to let your lender know up front if the development or project you live in is in litigation. It is usually possible to obtain financing in such situations, but it will limit the number of lenders who might be able to finance your mortgage. In some cases the lender may require a higher percentage of equity in the property and the interest rate could exceed that of standard financing programs.

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