Mandatory Disclosures of Condominium Purchases in Louisiana
Whenever a person purchases a condominium in Louisiana, there are mandatory disclosures and declarations that the seller must provide to the purchaser. This information is available from the Condo Association. Until such time that these statutorily mandated disclosures and declarations are provided, the Purchaser is able to withdraw from the contract to sell.
In accordance with LA R.S. 9:1124:107, in the event of a resale of a unit, an owner, other than a declarant, shall furnish to a purchaser of any contract to purchase a unit, or otherwise before conveyance, a copy of the declaration other than plats and plans, the articles of incorporation or documents creating the association, the bylaws, and a certificate containing eight enumerated items. Those eight items include the following:
A statement setting forth the amount of any current common expense assessments.
A statement of any capital expenditures approved by the association for the current and two next succeeding fiscal years.
A statement of the amount of any reserves for capital expenditures and of any portions of those reserves designated by the association for any specified projects.
The most recent balance sheet and income and expense statement of the association, if any.
The current operating budget of the association, if any.
A statement of any unsatisfied judgments against the association and the status of any pending suits to which the association is a party.
A statement describing any insurance coverage provided by the association, and
A statement of the remaining term of any ground lease affecting the condominium and provisions governing any extension or renewal thereof.
The above provides the potential purchaser with information about the Condo Association's financial status and impending and potential obligations. By allowing the purchaser to withdraw from the contract to sell until the requirements are provided, the purchaser is protected from obligating themselves to a potentially disastrous situation.
Critically, one must understand that the protection of LA R.S. 9:1124.107 only extends to such time as the purchaser signs a contract of sale or other act of conveyance. Once the act of sale or any other act of conveyance has been executed, the purchaser can no longer rely on or claim the privilege of LA R. S. 9:1124.107. Thus, it is imperative the purchaser ensure all due diligences related to the transaction are completed prior to signing any document conveying ownership.
If you have any questions regarding condominiums, please contact Joseph Marriott at firstname.lastname@example.org or by telephone at (504)834-7171.