Dem House Hopeful’s Condo Rental Violates Mortgage Agreement

Mortgage rider indicates LuAnn Bennett can’t rent out Ritz-Carlton property

LuAnn Bennett / LuAnn Bennett for Congress Facebook page
• October 5, 2016 6:45 pm


Democratic congressional candidate LuAnn Bennett says she is renting out her Washington, D.C., condo, but that would be a violation of the terms of her mortgage according to documents obtained by the Washington Free Beacon.

Bennett has repeatedly claimed to be renting out her $1.35 million Ritz-Carlton condo in Washington, D.C., as she runs to represent Virginia’s 10th congressional district, but a rider to the mortgage agreement for the property states that the condo should be available for her "exclusive use and enjoyment at all times."

Bennett, who runs a Washington-based real estate company called the Bennett Group, claimed as recently as last month that she was renting out the apartment as a property of her business. "Yes, I own an apartment in Washington, D.C. My company renovated it. It’s now being rented, so it’s a business property and that’s kind of the end of that story," Bennett told the local Loudoun Tribune in response to allegations that she is a "carpetbagger."

If true, this would appear to violate the terms of a "second home" rider for the property filed with the D.C. government last September.

"Borrower shall occupy, and shall only use, the Property as Borrower’s second home," the rider states under the "occupancy" section. "Borrower shall keep the Property available for Borrower’s exclusive use and enjoyment at all times, and shall not subject the Property to any timesharing or other shared ownership, arrangement or to any rental pool or agreement that requires Borrower either to rent the Property or give a management firm or any other person any control over the occupancy or use of the Property."

It is typical for second-home loans to include such a rider as a condition for getting the mortgage. Second-home mortgages typically have lower interest rates than investment property loans.

A representative for Bennett’s campaign did not return a request for comment by press time.

When contacted by phone, a spokesperson for the Residences at the Ritz-Carlton told the Free Beacon that Bennett’s unit is "rented out," but would not say to whom.

Bennett is challenging Republican Rep. Barbara Comstock in the race to represent Virginia’s 10th district.

Bennett has come under fire for living outside the district before launching her congressional bid. In addition to the D.C. apartment, which is located near her business, Bennett owns a farm in Fauquier County, Virginia. She only began renting a house inside the district last December, eight days before the Washington Post reported the launch of her congressional bid.

Bennett told the Post that she was renting out the apartment and had recently moved inside the district from her home in Fauquier County, which, according to online property records, was first put up for sale in 2012 and is currently listed for $2.5 million. The Ritz-Carlton apartment, which she purchased in January 2014, is under a mile from her real estate office. The farm is more than 50 miles away.

Bennett has said that she primarily lived at the rural home in Virginia and occasionally spent nights in the Washington condo.

Bennett has been accused by Republican groups of moving to the district only to run for Congress.

The ethics watchdog group Foundation for Accountability and Civic Trust, or FACT, also filed a complaint with the D.C. government alleging that Bennett failed to pay district taxes in 2014 and 2015.

Bennett has brushed off these accusations, insisting last month that she has "lived uninterrupted in Northern Virginia for 35 years, at least as long as Rep. Comstock, maybe longer."

Bennett listed her apartment as for rent for $7,500 per month for a one-year lease in December 2015, the same month that she announced her congressional bid. According to records, Bennett obtained a basic housing residential business license from the D.C. government for a "single family rental" in March, several months after the condo was put up for rent.

She reported thousands of dollars in income from renting the D.C. apartment on her 2016 personal financial disclosure.

Published under: Virginia