Buying New? A Term You Should Know: Capital Contribution
Here’s a term you don’t hear often: Capital Contribution.
-What is a capital contribution? A “fee” that is incorporated into your closing costs at settlement to be contributed to the working capital fund of the homeowners association. Consider it the equivalent of a minimum balance to opening a bank account.
-How much is it usually? While every development is different, in Northern Virginia it’s usually equivalent to 2 months of the condo fees.
-Who pays for it normally? First time buyers of a new construction project foot the bill for this one.
Come on, there has to be a catch to buying something BRAND NEW, right? 🙂