Replies to This Discussion

Permalink Reply by Kent Dills on April 5, 2010 at 7:49am

Gwendolyn,

As in all property purchases, most all terms and conditions are negotiable. So, you've got several options.
1. Tell the listing agent to tell the bank that your buyer won't pay the HOA fees. Then see what they say. It sounds like they've already said, "fine- no deal" to two previous buyers so that sounds like a high probability result.
2. Your buyer pays the fees and buys the house. This might not be a bad result if the fees are less than or equal to the difference in the market value of the home and the usually lower list price on short sales. I normally sell mine for about 90-95% of FMV (depending on the type loan, the servicer, the investor, mortgage insurance, etc.)
3. Everyone (seller - if able, listing agent, you, buyer) pitches in an takes a little of the "haircut" to make this happen. Of course, this is dependant on the amount of HOA fees, amount of commissions, etc. I've gotten several HOA management companies to share in the "haircut" by discounting the amount owed to get the property sold and newer/better homeowners in the neighborhood.
Etc, etc, etc.

Permalink Reply by Juan Reyes on April 5, 2010 at 7:55am

How much are we talking about?

I had a similar situation where the seller was 6 months behind once the sale was approved, even though I told her to continue paying the condo fee. She ended up bringing $1,400 to the settlement.

Unless the past due amount has been converted into a lien, then BOA will not pay for the fees. If a lien has been recorded for the back dues than I would inform BOA that there is a 2nd lien on the property and send them a copy of it to show proof. BOA should approve up to $3,000 to go towards any junior liens.

If not try and work out a solution where the buyer and seller split the amount evenly.

Permalink Reply by Gwendolyn Harvey on April 5, 2010 at 1:03pm

The past due balance was $8000.00. The listing agent said the HOA management cut it in half to $4000.00. So, they would want my buyer to bring that to closing. Plus my buyer is trying to get the deal completed by June 30th so he can get the $8000 tax break. But I am a little skeptical about that when working with BOA. It may take longer than that to work everything out. They really need to streamline their short sales and get a quicker approval. Thanks.

Kent Dills said:

Gwendolyn,

As in all property purchases, most all terms and conditions are negotiable. So, you've got several options.
1. Tell the listing agent to tell the bank that your buyer won't pay the HOA fees. Then see what they say. It sounds like they've already said, "fine- no deal" to two previous buyers so that sounds like a high probability result.
2. Your buyer pays the fees and buys the house. This might not be a bad result if the fees are less than or equal to the difference in the market value of the home and the usually lower list price on short sales. I normally sell mine for about 90-95% of FMV (depending on the type loan, the servicer, the investor, mortgage insurance, etc.)
3. Everyone (seller - if able, listing agent, you, buyer) pitches in an takes a little of the "haircut" to make this happen. Of course, this is dependant on the amount of HOA fees, amount of commissions, etc. I've gotten several HOA management companies to share in the "haircut" by discounting the amount owed to get the property sold and newer/better homeowners in the neighborhood.
Etc, etc, etc.

Permalink Reply by Gwendolyn Harvey on April 5, 2010 at 1:04pm

The past due balance was $8000.00. The listing agent said the HOA management cut it in half to $4000.00. So, they would want my buyer to bring that to closing. Plus my buyer is trying to get the deal completed by June 30th so he can get the $8000 tax break. But I am a little skeptical about that when working with BOA. It may take longer than that to work everything out. They really need to streamline their short sales and get a quicker approval. Thanks.


Juan Reyes said:

How much are we talking about?

I had a similar situation where the seller was 6 months behind once the sale was approved, even though I told her to continue paying the condo fee. She ended up bringing $1,400 to the settlement.

Unless the past due amount has been converted into a lien, then BOA will not pay for the fees. If a lien has been recorded for the back dues than I would inform BOA that there is a 2nd lien on the property and send them a copy of it to show proof. BOA should approve up to $3,000 to go towards any junior liens.

If not try and work out a solution where the buyer and seller split the amount evenly.

Permalink Reply by Katerina Gasset on April 5, 2010 at 7:18pm

We have the buyers pay for HOA fees all the time. It is what it is. We tell our sellers to all keep current on HOA, we tell them that it can kill a deal, but some either really don't have the funds to pay and some just won't. Of course it is their responsibility but that is really an oxymoron in a short sale since the short fall is actually the seller's responsibility too and so are all the closing costs. Many of our listings have HOA issues and the buyers walk, but then, we find another buyer. Piece of cake here where 60% of our sales are all cash.