Unit 2: Property Ownership (Common Interest)

Question 1

What are common interest communities?

Answer 1

Any entity with the right to charge mandatory assessments for common elements.

These properties combine sole ownership with co-ownership.

Question 2

What are the 4 types of common interest communities?

Answer 2

1. Condos & Townhomes
2. Planned Communities
3. Cooperatives
4. Timeshares

Question 3

In Minnesota, who regulates these communities?

Answer 3

Minnesota Common Interest Ownership Act

Question 4

T/F The Act gives common interest communities statutory lien power for unpaid assessments.

Answer 4

True

Question 5

What 2 kinds of properties are not covered under the Act?

Answer 5

1. Multi-tenant rental properties (apartments or 4-plexes)

2. Single-family homes unless part of a CIC

Question 6

What kind of ownership exists in condominiums?

Answer 6

Fee simple ownership of the unit plus tenants in common for common elements.

Question 7

How are condominiums created?

Answer 7

1. New construction

2. Converting an existing structure

Question 8

If an existing structure is being converted into a condo, how much advance notice needs to be given?

Answer 8

120 days
4 months
1/3 of year

Question 9

If an existing structure is being converted into a condo, how many days do the current tenants have to purchase their unit?

Answer 9

60 days from the notice

Question 10

What conditions allow for a tenant be given 60 additional more days to vacate the converted structure?

Answer 10

If they are 62 years or older, disabled, or have minor children.

Question 11

What needs to be recorded in order to establish a condominium or other common interest communities?

Answer 11

Condominium declaration

Question 12

What must be included in the condo declaration?

Answer 12

1. Specification of common and limited common elements
2. Restrictions on use and sale of units
3. If timeshares are allowed

Question 13

What needs to be added to a condo declaration if major changes are to take place in the condo?

Answer 13

An amendment

Question 14

T/F An approval by 3/4s of the association members must be needed to approve any major changes to a condo.

Answer 14

False. Condos need an approval of 2/3.

Question 15

T/F While every unit owner becomes a member of their homeowner’s association upon receiving the deed, they are not required to attend the annual meetings.

Answer 15

True

Question 16

Upon signing the purchase agreement, Jim and Sue receive the declaration, budget, and association rules for their new condo. How many days do they have now to rescind their offer?

Answer 16

10 days

Question 17

If a unit owner does not pay their association expenses, what can the condo association do?

Answer 17

They can file a lien and foreclose by advertisement.

Question 18

What are the 2 kinds of insurances that condo associations have?

Answer 18

1. Liability

2. Property

Question 19

T/F Common Interest Communities may charge special assessments to unit owners and these charges are not taxed.

Answer 19

True