Is it a Condominium?
How do I know if it’s a Condo? Because of the changes to the condominium approval/review processes it is absolutely imperative that you understand what type of property you are dealing with BEFORE you move forward with listing, selling, or buying a property in Colorado. Condominiums present financing challenges better addressed at the beginning of the transaction, as opposed to later. For example: There’s no point writing up an offer at midnight for a buyer when this project isn’t on an approved list and the project wouldn’t qualify even if it was submitted for review.
Condominium definition in Colorado: A form of ownership where units are owned by individuals but the land and common areas are owned jointly with all owners.
So what should you do?
1. Do not accept MLS information or verbal information. Get a copy of the legal description.
Blindly accepting what you read on the MLS listing or what the current owner says isn’t smart. Very agents and buyers should actually READ the legal description.
2. Do NOT rely on the project name for determination.
Many projects have misleading names. The developer names the project “Shady Pines Townhomes” so people assume that because the word “Condominium” isn’t mentioned that it’s not a condo and doesn’t require project approval.
3. READ the legal description – Does the legal description of the unit include the lot?
If not you probably have a condominium form of ownership. Check the project documents.
4. Contact a Trusted Lender – An experienced lender will know what to do right away to determine if the home is a condominium.
NOTE: There is a special exemption from project approval for “Site Condominiums” defined as detached units with no attached/shared garages etc. Site Condos are typical for only a few states.