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What if there is a lien on the property when you buy it? What if it's still there a year later?

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Real Estate Agent 5660894-PB00

 

Homeowners Association

 

 

 

 

 

 

 

 

 

 

Yesterday I wrote a blog.... If you Sue an Homeowners Association (HOA).  Who are you really suing? 

Because of this statement that was written in an email in regards to an outstanding HOA assessments against their home.

"............ I will be contacting a lawyer tomorrow. If this does not get resolved promptly or if there is a lien placed on my property and/or showing on our credit reports, I will counter sue you for damages to our credit and the time that it takes for us to correct your error." 

Today, I would like discuss this section of that statement.  "if there is a lien placed on my property" 

This topic has several concerns.  Here is a few of them.

  1. The lien was on the property when he purchased it.
  2. The seller knew about it.
  3. The sellers agent knew about it.
  4. The title company knew about it.
Which begs the question.  Why didn't the be buyer know?  Or did he and just forgot.

Utah's disclosure laws are very specific.  The Real Estate Purchase Contract reserves the right to conduct a complete Due Diligence.  Unless you waive it by checking "IS NOT."

Due Diligence Condition























There were real estate agents on both sides of the transactions.  The sellers disclosure should have been completed and past on to the buyer.  The following sections should have covered the lien issue.

disclosures























Which makes me want to ask the same question again.  Did the buyer know and if not, why?

 

Utah has an excellent State Approved Real Estate Purchase Contract (REPC).  

It's a great tool. 

It can be a great benefit to you in the purchase.

 

Happy Home Buying!

 

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Mark Watterson is a Utah licensed Real Estate Broker with Principle Realty Group, Inc. and a Utah license Loan Officer with Springwater Capital, LLC

Contact Mark Watterson your Local Property Resource Specialist for the most up-to-date market conditions data for Salt Lake, Davis, Utah and Weber Counties.  View comprehensive property resource information atwww.markwatterson.com

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Show All Comments
Dave Iliff
Patterson Schwartz - Hockessin, DE
Real Estate Agent in Hockessin, DE

Where was the title insurance?

Dec 20, 2009 01:45 AM
Geoff ONeill
John L. Scott Medford - Medford, OR

That should have shown up on the preliminary title report.  Even if it did not, the title officer should have contacted the HOA to determine if there were any outstanding balances.  Usually there is a transfer fee, so he/she would have needed to contact them anyway.

Dec 20, 2009 01:54 AM
Mark Watterson
Salt Lake City, UT
Utah Real Estate

Dave- My understanding the policy was issued.  I have not seen it.

Geoff- The HOA was contacted and they were told of the lien.  I assume it did show up on the PR.  The transfer fee was paid by the buyer.  It was the sellers side that was not resolved.

Dec 20, 2009 02:15 AM
Alexandria Virginia
Featuring Susan Craft, CRS, REALTOR® - McEnearney Associates - Alexandria, VA
Real Estate Editor

It always amazes me how these things get so convoluted and how some even get through.

Dec 20, 2009 02:21 AM
Michele Reneau
Certified Staging Professional (CSP) Elite Instructor - Summerville, SC
Realtor, GRI ~ Charleston, SC Relocation Experts Team

Mark-It is a shame when this happens to a buyer.  I would have hoped it would have come up in the title search and that they would have bought title insurance which should step in. HOAs can be nightmares. I've dealt with a few and luckily were able to get it resolved prior to closing. 

Dec 20, 2009 09:46 AM
Mark Watterson
Salt Lake City, UT
Utah Real Estate

Alexandria- They really do sometimes.

Michele- I agree buyers shouldn't have to deal with these issues.

I don't know if it came up in the title search (It should have).  I do know the title company was told. The title company may have even escrowed the funds.  We should know that in the next few days and then this will go away.

Dec 20, 2009 11:41 PM
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