Q. An engineer inspected the balconies of our association, built in the 1980s. The engineer’s report was rather sketchy. The report concludes that there are construction flaws with the spindles of the balconies that need to be corrected. Is there anything we should ask the engineer?
A. The term “construction defect” can refer to a variety of issues. The engineer needs to be more specific. For example, does the construction of the balconies deviate from the building code that was in effect at the time the balconies were built, as opposed to current code requirements? Does construction deviate from approved building plans? Or is there some kind of design flaw? The answers to these questions will help the board determine its responsibility to correct the problem.
Q. An owner of our condominium has requested an up-to-date list of names, addresses, email addresses, phone numbers, and weighted votes of all members eligible to vote. Are there any restrictions on the use of this information, and can the association require an owner to sign a confidentiality agreement when they receive it?
A. Under Section 19(a)(7) of the Illinois Condominium Property Law, an owner may review and copy names, addresses, email addresses, telephone numbers, and weighted voting of all members entitled to vote.
A member of the association has the right to inspect, examine and make copies of these records, but only for purposes related to the association. As a condition of exercising this right, the board of managers or the representative of the association may require the member to certify in writing that the information contained in the records obtained by the member will not be used by the member for commercial purposes or for any purpose that does not concern the association. “Commercial Purpose” means the use of any part of these recordings, or information derived from these recordings, in any form for sale, resale or the solicitation or advertisement of sales or services.
In addition to obtaining such certification, many associations require the owner to sign a nondisclosure agreement. I do not consider requiring a confidentiality agreement in these circumstances to be unreasonable. In other words, just because a particular owner is entitled to the requested documents does not mean that another owner would be.
Note that condominiums located in the City of Chicago are not subject to the same general disclosure requirements as set forth in Section 19(a)(7) of the Act. That’s because Chicago has enacted an ordinance to limit the availability of this information under its “home rule” authority.
Q. Our condo association is not FHA approved. Can a potential buyer of a unit still obtain an FHA loan to purchase a unit in the association? I have received conflicting information on this.
A. A Federal Housing Authority loan is a government-backed mortgage. The FHA allows what used to be called “one-time approval.” The FHA Single Unit Approval program was launched in late 2019. The FHA Single Unit Approval program, formerly known as Spot Approval, allows an FHA mortgage to fund a unit loan in an association, without the association itself has to obtain FHA certification.
To be eligible for individual unit approval, the unit must be located in a project that is not FHA approved, the unit must be complete and ready for occupancy, and the association must have at least least five housing units. The project must also meet certain requirements regarding FHA’s insurance concentration guidelines, percentage of owner occupancy, and project financial condition, to be eligible for FHA single unit approval.
• David M. Bendoff is an attorney with Kovitz Shifrin Nesbit in suburban Chicago. Send your questions for the column to him at CondoTalk@ksnlaw.com. The firm provides legal services to condominiums, townhouses, homeowners associations and housing cooperatives. This section is not a substitute for consulting legal counsel.
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