Can an owner effectively protect him/herself from the financial risks of having tenancy in common co-owners?
A popular was for apartment building owners to shield themselves from the financial risks of co-ownership is to carry all-inclusive “wraparound” financing for each TIC buyer. With this arrangement, the original owner continues to make all of the payments on any bank loan secured by the entire building, and the tenant in common co-owners make payments to the original owner. If a TIC co-owner does not make his/her payment, the original owner can foreclose using standard non-judicial foreclosure procedures (no court involvement). Non-judicial foreclosure is generally less risky than evicting a tenant in a rent-controlled city. Moreover, homeowner non-payments are extremely rare when compared with tenant non-payments, probably because a non-paying owner has a huge amount to lose. The newly available individual TIC loans provide an even lower-risk financing option. With this arrangement, each TIC buyer gets his/her own bank loan. But this approach requires that the original owner sell enoug
Related Questions
- Why would an owner or Realtor selling an entire property building obtain a tenancy in common agreement? Why not let the buyers get their own TIC Agreement?
- Can an owner effectively protect him/herself from the financial risks of having tenancy in common co-owners?
- Can an owner effectively protect him/herself from the financial risks of having tenant in common co-owners?
