I know this doesn't fit 99% of what we do in other transactions, just an odd HUD business practice. I made the same argument, why does it matter etc its still the same pot of money just clear it at COE and we are good to go.
Nope, the old dues had to be paid by some other department first. Remember this is the government we are dealing with! Yes, my conservative tendencies are being revealed, sorry!
Lots of phone calls, emails and patience!
This is a ridiculous position for the HOA to take. Why would HUD, or anyone for that matter, pay the back HOA fees until the home is actually purchased. What should happen is the late HOA fees being paid be made a condition of the closing. In other words, once the deal is done, the title company is required to pay these late fees as part of their duty as the escrow agency. This is the way all such encumbrances, or liens, on a home being purchased are handled.
Are you sure this is the real situation?