Home Buying in 92604>Question Details

Ioana, Home Owner in 92656

Have been asked to pay $829 for HOA CC&R's and bylaws copies

Asked by Ioana, 92656 Wed Apr 27, 2011

I'm the buyer of an REO property and my contract says I have to "obtain" HOA CC&R's and Bylaws. My escrow company ordered the whole package of copies available for the two HOA's and added the cost of $829!!! on my settelment. I was not asked if I can get them myself, if I need all those copies and was not told how much they are actually. When I signed the contract my realtor told me they are about $300 for both HOA's. Now the escrow company (which by the way, I did not choose, the seller did) is telling me I have to pay. Do I have to get all those docs, isn't that too much for some copies? I read other answers about this topic online and everyone keeps saying that is a small fee to get them. Other buyers got them from previous owners. Did't they have to ask me if I want them or can get them on my own?

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That cost of $829 is likely not JUST for the copies of the CC&R's, Bylaws etc., but is also for any HOA TRANSFER FEES x2 for both associations. Rush delivery may also be a factor. You CAN get the property management co of the HOA to give to you a BREAKDOWN sheet of what ea. material actually cost & what it was for.

As far as being charged for a Rush delivery, find out from the property mgmt co. for the HOA how long the docs would have gotten to you had you NOT done Rush delivery. If you didn't reallllly need Rush Delivery & the escrow co. ordered it that way without asking you or your Realtor first, you should ask the Escrow co. to cover the cost for the Rush.

EmilyKnell1@yahoo.com
562-430-3053 cell
Realtor Since 1996
1 vote Thank Flag Link Wed Apr 27, 2011
Hi Loana,

I do real estate transactions in Irvine. The average costs (regardless who gets them) is $300 per association. Additional cost can be for rush delivery and/or something called a "condo cert", which is mostly required for when you get a FHA loan to purchase the property or if your lender requires it.

If you feel that your real estate agent didn't disclose this to you properly, then I would ask him to rebate a portion of his commissions to make up the difference or see if the escrow company can reduce their fees. Just based on my experience with REOs and their use of escrow companies, you are better off hitting up your agent.

Regards,
Satar Naghshineh
CA Real Estate Broker
1 vote Thank Flag Link Wed Apr 27, 2011
Seems like a lot of he said, she said. Typically condo or HOA docs are handed down from seller to buyer and are updated each year with new budgets and possible additions to the Q & A. At $829 it looks like someone is padding the bill. Many of our docs have been downloaded for easy access but printing out a copy could use up a lot of ink and paper. In a REO situation the seller is usually long gone and the "poor lender" has no intention of taking on any additional bills and if they do, guess who get to pay them.

My point of view, your agent should have been on this a long time ago and working to get them from someone. Any way, why would anyone buy or sell real estate without a real estate attorney, you cannot compare them to a title company.

Good luck with your closing.

Agnes Tabor, REALTOR
239 564-0384
agnes@agnestabor.com
Naples, Florida
1 vote Thank Flag Link Wed Apr 27, 2011
The racket here is the HOA Management company. By most laws, HOA's can only charge reasonable costs (cost of printing). The management company's however have discovered that this is a LUCRATIVE side business. In fact, in my recent trnsaction, the HOA managment company would provide these FREE to the homeowner. But if a title company requests the docs, they charge $50-$100. How is this fair when the title company charges it back to the homeowner? On top of that they charged a ridiculous transfer fee of $200 per association. All that was invloved was changing names in their computer. I requested they provide me documentation of their costs and they have ignored me. Sweeping legislation is moving around the country to halt these excessive fees. I plan on taking my HOA management company to small claims court. It becomes a private transfer fee because the management company doesn't pass along the proceeds to the HOA, they pocket it. Under our state law, they can only charge costs, not profit from it. It is a sneaky little business they operate and buyers/sellers beware. I would appreciate if RE professionals don't take it so lightly. It is excessive and they hold sellers hostage at closing. If this was coming out of your pockets (commissions) you would have a different attitude.
0 votes Thank Flag Link Tue Aug 21, 2012
Hi Ioana,

For 2 different HOAs that might be right.....although I agree with Emily that it probably includes the transfer cost as well. I am not aware of any way to get them free....unless the previous owners have them, but since this is a REO, that's unlikely.

You are making a very important decision...I know that it's a lot of money, but making a mistake would be much more costly, be sure to do all your research!

Karen
0 votes Thank Flag Link Tue May 3, 2011
I looked at your other question and it looks like I was right about you getting an FHA loan. If anything, you will need the condo cert because of your loan. The rest is for your own files and information. It's to make sure that everything related to the HOA has been disclosed to you. For example, an agent friend of mine got sued by his client because the client wanted to buy a house that would allow him to park his RV. After the purchase, the HOA didn't allow the RV as it was clearly stated in the CC&Rs that RVs were not allowed. The agent didn't order the CC&Rs to reduce the buyer's costs and assumed RVs were allowed because another house had an RV parked there.

I agree that they ordered everything and put a rush order on it as $800 seems about right. It's better that way in case your lender wants something from the HOA, you don't have to wait another 7 days before getting it. It also meets your contingency requirement on your purchase offer.
0 votes Thank Flag Link Thu Apr 28, 2011
You can get the CC&R's (and probably the Bylaws) from the title company , typically without cost.
Additioinally, You need minutes of HOA meetings for the last 12 months, and the financials.
Your lender may need a HOA Certification, which should be under $100.. Some lenders pay this, some pass it on to you.
Find out from the HOA/Escrow what the price would be for the minutes and financials, insist that the escrow get the documents which are public record (CC&R's, at least) from the title company, and tell them that you will only pay for the docs which are not public record.
0 votes Thank Flag Link Wed Apr 27, 2011
The HOA'S and CC&R's should be prvided free by the HOA and Realtors.
0 votes Thank Flag Link Wed Apr 27, 2011
So just exactly which documents do I need from all the list. I looked them up on the prop.mngmt. websites and I could order them separately: HOA Demand, Litigation, CC&'s, Art. of Incorporation, By-Laws, etc etc, each item has its own fee. Aparently escrow just ordered all of them, and at first they've said seller pays . I don't think I need all of that.
The contract says seller pays for HOA transfer and I pay for obtaining (whatever that means) CC&R and bylaws. My realtor keeps just repeating that without answering my questions how come I ended up with $829 and if I could've got them on my own. If I add everything is available it's a lot, probably close to 800 like they said. But I'm still confused as why did they ordered all of them? Also what happens if I'm not going to be the owner of this property, why would I pay for all these copies? Can they be returned, as I saw something like if there is no closing, the fee is 75 each. Do I have to return them since I never ordered them or the escrow will take care of that?
0 votes Thank Flag Link Wed Apr 27, 2011
Quite often the CC&R's for a complex is already of public record and simply calling the association and getting the recording information on them will allow you to order them directly from the County Recorder. Any local Title Company can do this for you. We have representatives from First American thanking us for our orders (that they provide to us free of charge). If this isn't possible, because the Bylaws aren't of record or other such , then yes, $829 is ridiculously high but I would think the Escrow Company is trying to make up a reason to get some more funds padded into the HUD1 for a semi defensible reason. I don't know of a law prohibiting this, however I would call the HOA directly and it is very likely they can provide these to you a heck of a lot cheaper than the Escrow Company is doing. Also, unless you are tied in to this Escrow, you should be able to switch Escrows. I would be inclined to do this just on the principle of the thing if they wouldn't come down on that fee and you couldn't get this another way. Of course, if you've already put it in contract form to pay for this and they've gotten it for you, I think you may be too late. Don't be backed off from protesting this, the amount is extremely high.
0 votes Thank Flag Link Wed Apr 27, 2011
Loana, the first answer you received was great! The problem seems to be Property Management companies can do what ever they want! "normal" fees for HOA cert and the budget is around $350 to $400. You can not get copies from the seller because of changed which "may" have occured which the previous owner may or may not have included. Your lender is the one who requests the paperwork from escrow on your behalf. The only way around it is....if you pay all cash and do not use a mortgage lender.

Hope this helps,
Sharon
0 votes Thank Flag Link Wed Apr 27, 2011
Hi Ioana, it does seem expensive for HOA CC&R's & Bylaws, my advise to you will be, call the escrow company & talk to the escrow officer to give you an invoice from the HOA, if they can't do that, ask them the HOA company name & numbers & call them yourself & just ask the HOA company as if you are from an escrow company asking how much will copies for the CC&R's & the bylaws copies cost.
Hope this helps. Make sure you tell the HOA company the tract/ community of the home you are buying.
Good luck. :)
0 votes Thank Flag Link Wed Apr 27, 2011
I have a buyer of a condo who refuses to pay for the HOA transfer fee for CC & R's. Its a short sale and in the contract it stated sellers to pay for it , and they , B of A also refuse to pay. He says he can get a copy from a friend who lives in the complex. it is required to close the deal and by law to have the escrow compay order them, or can the buyer procure his own copy of the cc & r's.
Flag Mon Jul 9, 2012
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