When someone buys a condominium, there are unique aspects that differ from purchasing a stand-alone house. A key document in this context is the Condominium Rider, which amends and supplements the mortgage or security instrument for the property. It outlines the buyer's commitments not just to the lender, but also to the condominium association, detailing obligations regarding the payment of condominium dues and assessments in adherence to the Constituent Documents of the condominium project. The rider also covers insurance obligations, ensuring that the condominium association maintains proper property and liability insurance, thus safeguarding the lender's and the buyer's interests. It delves into what happens if there's a loss to the property, assigning insurance proceeds to the lender to cover the debt, with any excess paid to the borrower. Additionally, the rider addresses circumstances that might affect the condominium's status, such as condemnation or significant changes to the condominium project, requiring lender notification and possibly consent. This document underscores the relationship between the borrower, the lender, and the condominium association, highlighting the interconnected responsibilities necessary to maintain the property's value and the conditions of the loan.
| Question | Answer |
|---|---|
| Form Name | Condominium Rider Form |
| Form Length | 2 pages |
| Fillable? | No |
| Fillable fields | 0 |
| Avg. time to fill out | 30 sec |
| Other names | what is a condominium rider, fannie mae rider, form condominium rider, illinois condominium rider |
CONDOMINIUM RIDER
THIS CONDOMINIUM RIDER is made this day of, , and is
incorporated into and shall be deemed to amend and supplement the Mortgage, Deed of Trust, or Security Deed (the “Security Instrument”) of the same date given by the undersigned (the “Borrower”) to secure Borrower’s Note to
(the “Lender”) of the same date and
covering the Property described in the Security Instrument and located at:
[Property Address]
The Property includes a unit in, together with an undivided interest in the common elements of, a condominium project known as:
[Name of Condominium Project]
(the “Condominium Project”). If the owners association or other entity which acts for the Condominium Project (the “Owners Association”) holds title to property for the benefit or use of its members or shareholders, the Property also includes Borrower’s interest in the Owners Association and the uses, proceeds and benefits of Borrower’s interest.
CONDOMINIUM COVENANTS. In addition to the covenants and agreements made in the Security Instrument, Borrower and Lender further covenant and agree as follows:
A.Condominium Obligations. Borrower shall perform all of Borrower’s obligations under the Condominium Project’s Constituent Documents. The “Constituent Documents” are the: (i) Declaration or any other document which creates the Condominium Project; (ii)
B.Property Insurance. So long as the Owners Association maintains, with a generally accepted insurance carrier, a “master” or “blanket” policy on the Condominium Project which is satisfactory to Lender and which provides insurance coverage in the amounts (including deductible levels), for the periods, and against loss by fire, hazards included within the term “extended coverage,” and any other hazards, including, but not limited to, earthquakes and floods, from which Lender requires insurance, then: (i) Lender waives the provision in Section 3 for the Periodic Payment to Lender of the yearly premium installments for property insurance on the Property; and (ii) Borrower’s obligation under Section 5 to maintain property insurance coverage on the Property is deemed satisfied to the extent that the required coverage is provided by the Owners Association policy.
What Lender requires as a condition of this waiver can change during the term of the loan.
Borrower shall give Lender prompt notice of any lapse in required property insurance coverage provided by the master or blanket policy.
In the event of a distribution of property insurance proceeds in lieu of restoration or repair following a loss to the Property, whether to the unit or to common elements, any proceeds payable to Borrower are hereby assigned and shall be paid to Lender for application to the sums secured by the Security Instrument, whether or not then due, with the excess, if any, paid to Borrower.
C.Public Liability Insurance. Borrower shall take such actions as may be reasonable to insure that the Owners Association maintains a public liability insurance policy acceptable in form, amount, and extent of coverage to Lender.
D.Condemnation. The proceeds of any award or claim for damages, direct or consequential, payable to Borrower in connection with any condemnation or other taking of all or any part of the Property, whether of the unit or of the common elements, or for any conveyance in lieu of condemnation, are hereby assigned and shall be paid to Lender. Such proceeds shall be applied by Lender to the sums secured by the Security Instrument as provided in Section 11.
E.Lender’s Prior Consent. Borrower shall not, except after notice to Lender and with Lender’s prior written consent, either partition or subdivide the Property or consent to: (i) the abandonment or termination of the Condominium Project, except for abandonment or termination required by law in the case of substantial destruction by fire or other casualty or in the case of a taking by condemnation or eminent domain; (ii) any amendment to any provision of the Constituent Documents if the provision is for the express benefit of Lender; (iii) termination of professional management and assumption of
MULTISTATE CONDOMINIUM |
Form 3140 1/01 (page 1 of 2 pages) |
F.Remedies. If Borrower does not pay condominium dues and assessments when due, then Lender may pay them. Any amounts disbursed by Lender under this paragraph F shall become additional debt of Borrower secured by the Security Instrument. Unless Borrower and Lender agree to other terms of payment, these amounts shall bear interest from the date of disbursement at the Note rate and shall be payable, with interest, upon notice from Lender to Borrower requesting payment.
BY SIGNING BELOW, Borrower accepts and agrees to the terms and provisions contained in this Condominium Rider.
(Seal) - Borrower
(Seal) - Borrower
MULTISTATE CONDOMINIUM |
Form 3140 1/01 (page 2 of 2 pages) |