We put a hold deposit for a new primary residence condo unit that is being built. Closing has been delayed almost a year already due to construction issues, with now a closing date of June. We are doing conventional bank loan with 20% down.
We still want to move ahead with the purchase despite the delay. We found out earlier this year that my husband MAY potentially be required to move office location that is not within reasonable commuting distance of this primary residence. We can't confirm my husband's relocation as he is working for oil and gas and the industry is in a bit of a flux right now.
We intend to live in the condo but if he does relocate, which we will not find out before June, we need to move and plan to rent the unit. We can provide the paperwork from the office requesting him to relocate. This may be less than a year before we have lived there. Is this ok? Want to make sure we don't commit mortgage fraud.
Thanks all for your help.
Just want to share my clients issues. Not sure if similar:
We bought a new construction townhouse.
Said developer has built in incentives if buyer use their mortgage and closing. Free this, throw in that.
Since this was my first dealing with this developer and my buyer opt to go on it alone. (They said register your agent and we take over)
Anyways, I continue to consult on the side but not there on the meeting (I feel by design)
I know for a fact buyer has better financing options from outside vendor. But ended up with their affliates. While we were purchasing the developer rep knew that they may have to move for job, and said no problem. He can rent it out ;)
Well fast forward 2 months into ownership, he got job offer... There was a tiny clause on the financing that he can't rent until 1 yr after. And we got lawyer involved to read wording can't sell either.....
So he is still here... We are 1 yr next month... He lost the job opportunity. Can't sell, they just bought and the developer are still building new! He is phase 1.
cant rent until a year passes, cant sell until a year passes, so much for the freedom of OWNERSHIP!
This is a bummer, but thank you all for your replies
This is an unforeseen circumstance. Since you will not know whether you have to move until after June, which is about the time you close escrow, I don't think they can hold you accountable for the 1-year of living there. Talk to your loan officer or mortgage broker to be sure.
@Alnie Figueroa Even if you get a good deal, if there is no job and paycheck to pay the mortgage, or if there is rental restrictions, maybe it's not such a good deal after all.
Time to break out the initial contract and read the clauses one by one. Maybe talk to the developer about cancelling the deal and get a deposit back is the best way to go. You may have a way out if developer did not fulfill all the terms of the contract because of construction issues and delaying delivery of said condo by one year. Unilateral contract modification such as not finishing construction on time without notifying another party and get written permission to extend delivery date is usually breach of contract. So you may be on firm ground to re-negotiate the deal.
Not legal advise. Consult a lawyer.
@Minh Le thanks again for responding to my email! I did contact person you recommended and we are just waiting for some next steps before we can officially start the process. You rock!
@Steve K. I'd like to keep the property if possible. Even prior to moving, the values and rental rates have already gone up due to forced appreciation in the area (massive gentrification) and I get to hold the price from last year. The developers actually prefer we get out of the deal because there's already a long line of buyers waiting. This location is also close to my place of work, just not the hubby's. Definitely agree the job has to make sense, so we are looking for options. Worse case we have family in the new job site so my husband can crash there during weekdays until we meet the 1 year clause and figure out next steps.
Thanks again, your time and insight are much appreciated.
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