As the LTFC said in their Q&As, “The fee would be part of the negotiation process, and the seller may decide to absorb the fee to make the sale.”
Let’s face it; this fee is truly the seller’s responsibility.
Every Big Canoe homebuyer should be fully informed as to the impact of this fee. Should the homebuyer pay it on the front end, then at some time in the future, in another closing on the same house, he may be required to pay it a second time.
If the buyer understands this fact, then very few, if any, buyers will be foolish enough to pay the seller’s liability (CIF); the rightful owner of this financial liability is the seller.
If this CIF is put in place by the vote of the developer and/or the property owners, then a CIF liability statement should be included in the seller’s disclosure statement.
Before the closing, every Big Canoe homebuyer should fully understand the financial double jeopardy that the CIF places him in.
Even if this type disclosure is not a legal requirement, it is the moral and the ethical thing to disclose.
—————————————-
Question for the LTFC:
Should the seller’s disclosure statement explain to the homebuyer the possibility of the Capital Initiation Fee causing a case of financial double jeopardy? Your answer should be yes or no.
3 users commented in " The Capital Initiation Fee (CIF) and the Seller’s Disclosure Statement "
Follow-up comment rss or Leave a TrackbackThe various “facts” posted on this site are confusing.
One states that the cost of the clubhouse increased from $5M to $10M. Another states it increased from $4M to $12M. There must be documented original and current costs. What are the facts?
What caused the increases?
Was there a vote by the Board?
How many are required to pass an increase? It is hard to believe that two votes can pass an increase.
How many voted to approve the increases?
Why would the developer vote for this fee? Wouldn’t he pay for each of the 2,000 homes to buildout? If they average $500,000 isn’t it better for the developer to pay this $10M than for property owners to pay it?
Please post also on the POA site - obviously they are not responding here. Yes you will have to disclose on the Seller’s Disclosure. Any agent that takes a listing will insist it be there - even if the seller does not disclose it - the agent must per licensing law. Ask the POA what the costs of the clubhouse is - the comments in here are mostly residents like you and me demanding accurate information. Please go to the POA forum and ask those questions. You have to be your own advocate for these things. They think other communities are charging these fees and they ARE NOT! Talk to your realtors - some are already losing buyers to this issue. There are 239 Homes, 118 Lots, and 8 Condos on the market now! There are only 11 Pending Sales - wow that is up from 8 - We should have 20% of those under contract at this time of year. April is the biggest month in BC and the POA has set this up to be not so good. Its up to you residents!
Keep in mind that there has been a verbal agreement to answer questions posed on this site. I’ll be pulling questions out of various posts to submit to the LTFC, and hopefully they will do their best to answer them. If you have any specific questions you would like submitted, please email them to admin@4kfee.com.