What are our options if after purchasing property for investment purposes,we have been informed thatwe can’t rent it out?
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What are our options if after purchasing property for investment purposes,we have been informed thatwe can’t rent it out?
We purchased our condo on a short sale; it took 11 months to close. The condo was listed as “investment property available to rent”. Our agent knew we would only purchase property we could rent. After the closing, I went to the management company to pick up the rules and by-laws. I was informed that the association has a 12% cap on rentals and they had reached their limit. They said we would never be able to rent this property. Our tenant is due to move in next week. What are the legal repercussions if we allow our tenant to move in anyway?
Asked on June 16, 2011 under Real Estate Law, Illinois
Answers:
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If you violate the condo rules then they can exercise their rights under the law as well as in the by-laws. Most likely they will sue you. You will have breached the contract that you agreed to abide by. You relied on the broker or seller's representations - which were mis-representations - but you had an obligation to read all the paperwork before you bought the property. You need legal help at this point in time to decide how to proceed. Someone needs to read the rules and find you a loop hole. And you may want to hold off on the tenant moving in at this point in time. Good luck to you.
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