Foreclosure in Macon>Question Details

Jon, Home Owner in Macon, GA

My home has been in foreclosure for 2 yrs. Haven't been able to pay assoc. dues either. Will I have to pay them if I do a short sale?

Asked by Jon, Macon, GA Sun Apr 22, 2012

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Tracey Martin’s answer
Someone will have to pay the HOA something in order to provide the new buyer with clear title and to get the deal closed.
In a short sale, making sure that clear title is provided, is the responsibility of you and your Realtor.
If you cannot pay the back due dues yourself, you have some options for help.The first place to go looking for help is the lender/servicer that owns your first loan. They almost always pay the HOA some, if not all (depending on what you owe,) of the past due fees.
If the amount your lender/servicer is willing to pay is not enough to get the HOA to settle and release their lien, then you and your Realtor need to get creative.
You can ask the buyer to help out. Sometimes buyers are willing to pay the back dues or, at least, pay enough to get the HOA to release the lien.
Any way you look at it, HOAs generally don't just go away. They will want something from someone. Find out what it will take to get them to settle and release their lien, then work with your Realtor, lender/servicer, the buyer's agent, and the buyer, to make it happen.
There are two important issues:
It is in your best interest to get them to settle. If all they are willing to do is release the lien, then they maybe leaving the option of pursuing you for the remainder owed, open. If they settle, you will not be pursued for the remainder.
If the lender/servicer is not able to pay everything the HOA wants, they must agree to whatever terms you and your Realtor have worked out to get the HOA to settle. In example, if the buyer is going to help, the first must say it is ok for them to do so.
0 votes Thank Flag Link Tue Apr 24, 2012
Outstanding HOA dues would have to be paid prior to the completion of a short sale.

Regards,
Rodney Mason, NMLS #151088
Sr Loan Officer
Prospect Mortgage
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
rodney.mason@prospectmtg.com
Apply Online at http://www.rodneymason.com
Licensed in Alabama & Georgia

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0 votes Thank Flag Link Mon Apr 23, 2012
With or without the lien, you will need a clear title to do a short sale. That means all the taxes, HOA dues and the mortgage lien need to be removed. It might be possible to sneak the HOA dues past everyone, but it's not a good idea since the new owner might be able to sue you after they find out the HOA is still owed, and it's just not the right thing to do.

My suggestion would be talking with the HOA and notify them that you'll be going through foreclosure if they don't release the HOA dues at the time of sale. They may relieve you of the debt.

The bank may also pay the fees as part of the short sale or negotiate them down. They stand to lose much more if they let you go through foreclosure all because of just a thousand dollars in past due fees. The bank typically pays the Realtors involved in the sale and taxes and other "junior" lienholders.

Best of luck to you!
0 votes Thank Flag Link Sun Apr 22, 2012
Jon, I'm happy to help! The number of homes sold seems to be increasing, so this may be a great time to finalize a deal. I hope it works out for you!
Flag Mon Apr 23, 2012
Jonathan,
Thank you for the information. I was planning on getting in touch with the association. I have just recently looked into what's involved with a short sale. Hopefully the HOA doesn't give me too many problems. The home has been vacant since this time in 2010. I enlisted in the army in 2009 and got stationed in Colorado. We were unsuccessful with trying to sell it. It was on the market for about 7 months. We had renters for a few months until they had problems making the rent and we were forced to kick them out after we missed the motgage payment that month because of it. We just haven't had the money to put into it to get the loan back current.
But I wasn't sure whether I was still liable for the dues since it's been in active foreclosure and it's been vacant for so long. So thanks again for the info. I'll talk to the HOA and my real estate agent.
Flag Sun Apr 22, 2012
If you haven't paid association dues in two years has the HOA put a lien on your property? If so, that would have to be paid off before you could close.
0 votes Thank Flag Link Sun Apr 22, 2012
Jon, most closing attorneys in Georgia check with an HOA to determine if dues are owed and how much, so they will need to be paid as part of the short sale. Luckily, you often don't have to pay them yourself, but who pays them is part of the short sale negotiation process.
Flag Sun Apr 22, 2012
There's no lien that I've been made aware of. They have sent notices that my dues are outstanding.
Flag Sun Apr 22, 2012
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