Can My HOA Hold Up My Short Sale Closing?
No, we are not in Florida like the author of this post. The bad news is that the message is still very important and still rings true. In California, not paying your HOA fees will also come back to haunt you when the HOA holds you personally responsible for the arrearages, fees, penalties and legal costs and will not approved your short sale until they are satisfied.
Can My HOA Hold Up My Short Sale Closing?
Yes, they can and yes they will. This is for the state of Florida so please check the laws in your own state regarding HOA statutes. These legal statutes are changing all the time in many states as the HOA organizations are demanding stricter laws concerning foreclosures and homeowners that do not pay their HOA fees.
There are HOAs in Florida that monitor the foreclosure lawsuit. The HOA is concerned about their rights with the condo of townhome and they represent the rest of the homeowners or condo unit owners in that HOA. These residents do not like it when other residents don't pay their HOA fees because the burden of payment falls on those that are still paying.
To monitor the lenders' foreclosure lawsuit we are seeing the HOA charging a $500 fee which you will have to pay at closing before you can get clear title to give to your buyer. This fee can be charged to you whether you are current on your HOA fees or not. We always suggest to all of our clients even if they are not making their mortgate payments to make sure their HOA fees are current. When you go late on your HOA fees, there are late fees added and then attorneys fees on top of the late fees and interest fees. We have seen these fees get up into the $10,000 to $12,000 range in fees.
Here in Florida most often the HOA attorneys are not going to negotiate much on your HOA fees. Back in 2007 we were able to negotiate your HOA fees down to 50 cents on the dollar or even less but now that is not the case. This is because the HOA will foreclose on the property subject to your first lender. This means that the HOA will change the locks, lock you out of the gate and amenities and rent your unit out to a tenant. The rent monies collected go into the HOA fund.
When you bought your home or condo in an HOA you agreed to their rules. One of those rules is that if they have to hire an attorney on behalf of the HOA you agree in advance to pay for any legal fees that you cause your HOA to incur.
You can be current on your HOA fees and still be required to pay the $500 "foreclosure monitoring" fee at closing. Your lender may or may not pay this fee out of their loss for you, this depends on who the lender is and how much they need to net to make the short sale go through. To get your questions answered about doing a short sale contact Nestor and Katerina Gasset at 561-753-0135. Your call is confidential.
Nestor Gasset and Katerina Gasset- Realtors®, CIPS, ABR, SFR, GRI, REOS
International Properties & Investments, IncCall us today at 561-753-0135 to get your house sold.
Comments(2)