The statute does not mandate responsibility for late fees or attorney fees, but they certainly can make all this a condition of the sale if the contract is in attorney approval.
Where is your agent and attorney on this?
Minimize your risk and maximize the optimal outcome when you buy a foreclosure or short sale, use an agent and an attorney who know the process.
If you are still in the attorney review and/or modification period, you have choices: walk away; have your attorney negotiate away as much as possible and pay the remainder. Good luck to you!
You really need to seek legal and professional assistsance directly through an attorney, not through Trulia. I have noticed similar questions posted many times. Each time, respondents have encouraged you to seek professional opinions. If you had received counsel from an agent and an attorney specifically regarding this purchase, you probably wouldn't have found yourself in a situation like this. I hope that you will consult an attorney for assistance in resolving it.
I would probably threaten to back out unless legal fees were waived.
Have your attorney review the title and the contract. From the HOA standpoint and the other condo owners, somebody has to pay these back fees. Is it fair for the buyer to pay? That depends on your deal with the seller. Maybe some of these things can be negotiated. You have to weigh if it is a good deal or not and if you are required to pay per contract.
The banks are tricky on these REO's. Some things are legal and some skirt the legal issues. You should always work with an attorney and a Realtor to help ensure you are protected and there are no surprises.
Your question more comfortably dwells in the realm of what an attorney will handle. But oddly enough, the buyer can be responsible if he chooses to stay in this deal for the tidal wave of fees you just delineated. One important step that I and other experienced agents take when dealing with suppressed value transactions is making sure the bank or other lien holder is responsible for fees that include unpaid taxes, liens, fees, utility charges, unpaid taxes and legal costs. A responsibly written and insightful contract will seek to shield the buyer from costs that have nothing to do with him.
I hope you have an attorney because this question at this juncture is simply legal. When you executed the contract you did not have these fees in mind. Your attorney in the course of review may seek to extricate agreement on the seller's part to assume some portion of these fees or perhaps you have the latitude to unilaterally cancel the contract as these terms were not those you initally agreed to.
I wish you the best of luck in resolving this situation in your favor.
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In order to get the best answer on this, it's best you sit with the lawyer assisting you with this transaction. If you aren't working with a lawyer as of your Broker for a recommendation for a lawyer who deals with these types of transactions.