Arizona Realtors, are you ready for the new
H.O.A. Condominium/Planned Community Addendum?
Beginning February 2, 2105 Arizona will have a new/revised HOA Addendum that will be required to be completed for any transaction that involves a homeowners association. The old HOA Addendum was previously required to be completed and submitted by the buyer. The buyers were indicating which party pays for which HOA related fee when they completed the old HOA Addendum (at the time of submitting their offer to the seller), without any knowledge of the HOA, or the fees associated with the HOA.
This new HOA Addendum will be initiated by the seller at the time of listing their home. The homeowner will be responsible to provide information on the HOA, and the fees payable upon close of escrow, at that time. The intent of this new HOA Addendum (and process) is to provide the information to enable the buyer the ability to make an informed decision regarding which party will pay which of the HOA related fees in a transaction.
This will be a complete change in the process for listing agents as well as buyer agents. The listing agent should now include this new HOA Addendum as part of the forms they require the seller to complete, when completing the listing agreement paperwork. In addition, it is suggested that the listing agent upload this new HOA Addendum into the MLS (if available), or deliver the form to any prospective buyers upon their request. Buyers agents should print this new HOA Addendum from the MLS, or request this form from the listing agent, and have their buyer complete the form and submit it as part of their purchase offer.
Click on this new H.O.A. Condominium/Planned Community Addendum link to see what the new form will look like.
The new HOA Addendum is comprised of four parts:
Part 1 – Page One
This part of the HOA Addendum requires the seller to disclose information on the association(s) that govern the property, as well as the fees charged by the association(s) upon close of escrow.
Part 2 – Page Two
This part of the HOA Addendum identifies the legal obligations imposed upon the parties, including information that must be provided to the buyer.
Part 3 – Top half of Page Three (Lines 69 to 83)
This part of the HOA Addendum is to be completed by the buyer. After reviewing the HOA fees disclosed by the seller on page one, the buyer completes this section to establish which party will pay for the related HOA fees. The buyer(s) will then sign on line 100.
Part 4 – Line 103 of Page Three
This final part of the HOA Addendum is basically a signature line where the seller can accept the buyer’s proposal.
This new HOA Addendum, and process, is intended to disclose all HOA related fees up front, and establish which party will be responsible for paying those fees, in order to avoid any last minute surprises at closing that may place the transaction in jeopardy.
Again, this new HOA Addendum is scheduled to go in effect February 2, 2015. Since this is a significant change to the previous HOA Addendum process, it is important that all agents are aware of the changes. Please help spread the word by sharing this information about Arizona's new H.O.A. Condominium/Planned Community Addendum.