There is a Push to Make HOA Fees a Top Priority for HomeOwners
Currently most HOAs don't report your late payments but that might not be the case soon. FICO scores could be hit hard by those that don't pay on time.
I was reading an article on Realtor.com - HOA Fees Now May Affect Credit Scores and realized how important it is for homeowners to know about possible changes coming in the future. As much as we all have a love hate relationship with our HOAs, unfortunately, they are still a financial obligation we all have. While the vast majority of HOAs do not report late payments, they do usually attach as a lien to be paid upon selling.
In the future however, they might just hurt more than your sale, they might just impact your FICO which may in turn hurt the purchase of your next home.
The article found on Realtor.com stated:
"Until now, HOA payments have gone largely unreported to the national credit-reporting agencies,” says Matt Martin, chairman and founder of Sperlonga. “Our service will help elevate association payments to the same level of importance as the consumer’s other financial obligations like residential mortgages, auto loans, and credit card payments. Property owners that pay HOA fees on time should begin to see the similar impact [on] their credit reports as they would with other payment obligations traditionally found in a credit report.”
For property owners who are late or delinquent on their HOA payments, they will likely see a negative effect on their credit score, just as if they had missed a mortgage payment."
This change could impact current homeowners in a dramatic way if they get into a beef with their HOA and don't pay fines or monthly fees "as a matter of principle".
Keep this in mind. Don't let an argument over weeds or newspapers hurt your future home purchase.
This is great information for our customers / clients to realize before it is too late.