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Permalink Reply by Bill Travis on August 21, 2011 at 2:43am

HOA's have a lien for delinquent dues in AZ and title cannot be transferred without the HOA being paid. Of course. if it goes to foreclosure then the lien is wiped out.

Part of that $3900 is going to be fines. The listing agent should be negotiating with the HOA to see how much they will forgive.They will negotiate, but it takes time because it has to either be done through their attorney or at the board of directors meeting.

I would advise to not stand on principal. If the value of the house is worth $3900 more. then pay it and close. Otherwise, you may spend a lot more time trying to find another property and may not find one equal to this one. Then again you may find a better deal.

Neither the listing agent, nor the selling agent should pay anything out of their pocket for these fees. I'm one who does not believe in agents subsidizing buyers and sellers purchases, and I would let a deal fall through if the buyer and/or seller can't come to an agreement. My theory is, if I can't get a deal negotiated, then I don't deserve to get paid.

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Permalink Reply by jennifer mullen on August 21, 2011 at 3:01am

I'm not sure what state you're in, but in our state the title can't transfer unless it's clear.  It's possible the HOA will settle for less and the short selling lender will pick up part or all of the tab.  I've done that on numerous files.  The HOA usually realizes that they should take what they can and get new, dues-paying homeowners in there asap.  That will require re-negotiating the file with the lender, though, so be prepared for a delay.  Good luck!

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Permalink Reply by Sean Underwood on August 21, 2011 at 3:21am

More than likely the Title Company or Buyer's Mortgage Lender will send out an Estoppel Request to the HOA.

When this occurs, with or without the placement of a lien on the seller or property, the parties will be made aware of the HOA delinquency.

Asking agents to offer ANY sum of funds is not right..... This is not their delinquency or insolvency issue.

Consider agents to be mediators.... would you ask a mediator to pay any portion of your lawsuit?

It's unfortunate that you've been placed in this predicament.

However, it is able to be settled..... although there will be a delay of your closing.

The settlement with the HOA should have been done long ago..... prior to submitting the Short Sale to the lender.

The banks are not required to pay ANY delinquencies (e.g. HOA fees, taxes, insurance, etc.) until full foreclosure occurs.

Once foreclosure occurs, specific statutes (state and federal) will dictate what the bank is required to pay to the lien holders or demanding parties.

Get the listing agent to set up a meeting with the HOA and discuss a settlement.

Once a settlement is reached, have the seller and/or listing agent negotiate with the seller's lender in getting the lender to pay the settlement amount.

Remember, someone is losing money here.

This means negotiations are required, and it will not happen instantly.

Having patience, or walking away.... your only 2 choices.

 

I wish you the best :)

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Permalink Reply by Holly B. Long on October 5, 2011 at 3:57am

This is my first dealing with an HOA in California.  So I want to be sure I understand...The HOA fees are "personal" debt for the seller...so the HOA past due fees, penalties, interest, collection costs -etc...follow the seller but because the HOA has a lien against the property -- we can not sell the house with the lien against it. The amount the HOA wants to settle for is $6K --lender says they will only pay $1600 ---so the balance will have to be settled outside of closing (provided HOA will accept $1600 at closing and still release the lien ahead of time).  All I can do now is put forth to the seller and buyer --how much each will contribute to settle?  If there was not a lien in place by the HOA - the possibility exists that we could sell the house without the HOA being paid?  Would so appreciate any help you can offer in helping me to get clear on this issue for this sale and future sales.  Thanks

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Permalink Reply by cesar llanes on October 5, 2011 at 5:23am

Darlene,

 

Find out what is the minimum net payoff for the 1st and 2nd liens. If there is extra money left, then discuss with both agents (listing and buying) where to get other money to meet HOA payment. then revise the HUD1 showing the changes. I know this is a slim chance but I think, worth a try. You may go back to HOA and negotiate to reduce HOA liens.

 

Good luck!

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