Notwithstanding any other provision of this Declaration, no amendment of violation of this Declaration shall operate to defeat or render invalid the rights of the beneficiary under any deed of trust upon a townhome made in good faith and for value, provided that after the foreclosure of any such deed of trust such townhome shall remain subject to this Declaration, as amended. Notwithstanding any and all provisions of this Declaration to the contrary, in order to induce The Mortgage Corporation (“TMC”), the Government National Mortgage Association (“GNMA”) and the Federal National Mortgage Association (“FNMA”) to participate in the financing of the sale of townhomes within the project, the following provisions are added hereto (and to the extent these added provisions, pertaining to the rights of mortgagees, TMC, GNMA, VA and FHA, conflict with any other provisions of this Declaration or any other of the restrictions, these added restrictions shall control):
Provision A
Each first mortgagee of a mortgage encumbering any townhome, upon filing a written request for notification with the Board, is entitled to written notification from the Association of any default by the Mortgagor of such townhome in the performance of such mortgagor’s obligations under the restrictions, which default is not cured within thirty (30) days after the Association learns of such default. For purposes of this Declaration, a “first mortgagee” shall mean a mortgagee of a mortgage with first priority over other mortgages or deeds of trust on a townhome.
Provision B
Every owner, including every first mortgagee of a mortgage encumbering any townhome, who obtains title to such townhome pursuant to the remedied provided in such mortgage, or pursuant to foreclosure of the mortgage, or by deed (or assignment) in lieu of foreclosure, shall be exempt from any “right of first refusal.”
Provision C
Each first mortgagee or a mortgage encumbering any townhome, which obtains title to such townhome, pursuant to judicial foreclosure or the powers provided in such mortgage, shall take title to such townhome free and clear of any claims for unpaid assessments or charges against such townhome which accrued prior to the time such holder acquires title to such townhome.
Provision D
Unless at least two-thirds (2/3rds) of the first mortgagees (based upon one (1) vote for each mortgage owned) or two-thirds (2/3rds) of the owners (other than grantor) have given their prior written approval, neither the Association nor the owners shall:
- By act or omission seek to abandon or terminate the Property; or
- Change the method of determining the obligations, assessment dues or other charges (other than the special assessments of late charges imposed by the Board in accordance with the provisions of this Declaration) which may be levied against any owner, or the method of allocating distributions of hazard insurance proceeds or condemnation awards; or
- Partition or subdivide any townhome unit; or
- By act or omission, seed to abandon, partition, subdivide, encumber, sell or transfer the common Property. (The granting of easements for public utilities or for other purposes consistent with the intended use of the common Property under this Declaration shall not be deemed a transfer within the meaning of this clause); or
- By act or omission change, waive or abandon any scheme of regulations, or enforcement thereof, pertaining to the architectural design or the exterior appearance of the common Property; or
- Fail to maintain or cause to be maintained fire and extended coverage on insurable common areas as provided in Article 11 of this Declaration; or
- Use hazard insurance proceeds for losses to improvements to any common Property for other than the repair, replacement or reconstruction of such improvements, subject to the provisions of Article 11 of this Declaration.
Provision E
First mortgagees, upon written request, shall have the right to (1) examine the books and records of the Association during normal business hours, (2) require from the Association the submission of annual audited financial reports and other financial data, (3) receive written notice of all meetings of the owners, and (4) designate in writing a representative to attend all such meetings.
Provision F
All first mortgagees, upon written request, shall be given thirty (30) days’ written notice prior to the effective date of any proposed material amendment to the restrictions, and prior to the effective date of any termination of an agreement for professional management of the Property following any decision of the owners to assume self-management of the project.
Provision G
The common Property reserve fund described in Article 8 of this Declaration must be funded by regular scheduled monthly, quarterly, or semi-annual payments rather than by large special assessments.
Provision H
The Board shall secure and cause to be maintained in force at all times a fidelity bond for any person handling funds of the Association, including, but not limited to, employees of the professional manager.
Provision I
In addition to the foregoing, the Board may enter into such contracts or agreements on behalf of the Association as are required in order to satisfy the guidelines of the VA, FHA, TMC, the FNMA or the GNMA or any similar entity, so as to allow for the purchase, guaranty or insurance, as the case may be, by such entities of first mortgages encumbering townhomes. Each owner hereby agrees that it will benefit the Association and the membership of the Association, as a class of potential mortgage borrowers and potential sellers of their residential townhomes, if such agencies approve the Property as a qualifying subdivision under their respective policies, rules and regulations, as adopted from time to time. Mortgagees are hereby authorized to furnish information to the Board concerning the status of any Mortgage encumbering a townhome.
Provision J
Each owner hereby authorizes the first mortgagee of a first mortgage on his townhome to furnish information to the Board concerning the status of such first mortgage and the loan which it secures.