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Jay Molloy, Renter in Boston, MA

who pays special assessments in the sale of a cpndo?

Asked by Jay Molloy, Boston, MA Mon May 26, 2014

Hi There,

We live in a 4 unit building in the Boston area. One absentee owner is selling his unit. We have some special assessments in place for repairs and maintenance that have already started. There seems to be some confusion as to who is paying the assessment share for the unit being sold. The owners have a long history of not paying monthly dues etc. Is there a way to find out how their share is being paid? We're getting a 6D certificate that states the amount due etc. Our fear is that the sellers are expected to pay after closing...if that's the case...chances are the association won't collect that money easily. We're mixed messages from the sellers agent. HELP!!

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I don't believe your lender would approve a deal that required payment of past due monthly fees or special assessments after the transaction closed. Who pays special assessments is one of those things that's negotiable between buyer and seller. It also depends on how hot or cold the local market is and how badly you want this particular condo.

If a seller is behind on monthly fee payments and special assessment payments, I'd be concerned that he/she is also behind on mortgage or tax payments as well. This will show up when your bank orders a title search. Unfortunately, banks often wait until a week or two before closing to run the title search.

If the association has sued the seller for past due fees, it'll show up as a lien on the property in the land records of the county. You or your agent can go to the county's Registry of Deeds web site to find this information. A seller's agent should disclose outstanding liens, but don't count on it.

In Mass, condo associations who sue owners for unpaid fees get "super lien" status, meaning that when the property sells, the association gets paid up to 6 months worth of fees ahead of the seller's bank loan. However, the association is out of luck when it comes to special assessments, and they might try to get you to pay it.

Sounds like your agent and your attorney have some work to do before you're clear to close.

Good luck
0 votes Thank Flag Link Tue Jun 3, 2014
A 6D is required for closing & will be recorded. Who provides the 6D for your property? The 6D should state all monies owed including past due condo fees and any assessments.
In addition, if the buyer is obtaining financing, the bank will require a condominium questionnaire to be completed by the Trustee or manager of the association. That questionnaire usually inquires about special assessments, condo fees, how many unit owners are in arrears, etc.
Provided the buyer is being represented by an attorney, or better yet, they are obtaining a mortgage, the Buyer will make sure that all past due monies are paid from the proceeds of the sale at the closing. Often times, the best thing that can happen is if a problematic unit owner sells - the situation is resolved.
If it is at all questionable as to whether the association will be paid, the association should retain an attorney - the unit owner in arrears would be responsible for attorney costs as well. Condominium law in Mass is very strong and in the favor of the association.
Good luck!
0 votes Thank Flag Link Sun Jun 1, 2014
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