I read an article today about Homeowners fighting Homeowner Associations because of Homeowner Dues not being paid. It is an interesting article.
In my area I have seen many Associations place liens on a property which have held up the sale of a property but I have not seen the HOA actually foreclose on the property as this article is talking about.
Although, I know it is possible for them to do this and is probably happening here locally but definitely not to the extent it is apparently happening in the areas noted in this article.
I have received phone calls from Homeowner Associations asking me how they could purchase a Condo Unit that was going to Auction.
I have also seen MANY properties for sale that are bank owned and have a very large assessment due either at the close of the sale or added to the HOA dues among all homeowners in a complex or neighborhood.
I have seen Condo’s for sale that are owned by a bank that have a disclosure noting there is an assessment due at closing in the amount of $30,000.00! Under the remarks in the listing it states the purchase price does not reflect the HOA assessment due. In other words - add another $30k to this asking price!
I have also run across bank owned units where the bank did not disclose a large assessment due.
When working with Sellers that are in a HOA and are attempting a short sale (which is where this problem comes up a lot) we discuss the problem of the Seller not keeping their Homeowner Association Dues current and that the Seller runs a higher risk of the Association holding up the short sale until the Association is paid what is owed to them by the Seller or Buyer.
When working with Buyers that are looking at a property with a HOA we discuss the importance of checking into the HOA and it’s financial stability. We can do this by checking for liens on the property and reading through the resale certificate package.
The article here is a good one for Sellers and Buyers to take note of. Due diligence is a must anytime you are buying a property or selling a property and in today’s market there is even more reason to be a responsible Buyer and/or Seller.