If you have not already discussed the situation with the HOA President and/or Property Manager, it is best to inform them that your property is in foreclosure and that you have it under contract for a short sale. They know that if it goes to foreclosure then they are out of pocket for the filing costs, etc. They know that their lien is Jr to the mortgages so the only way they get the dues is if the short sale is successful. The HOA president is also likely one of your neighbors so it is not unreasonable to ask them for a little compassion in the situation. The property manager and HOA attorney respond to the requests of the HOA board. You could also ask to speak at the next board meeting to explain your situation. Most HOA boards do not know when a neighbor is in a situation so they can only assume that you are choosing not to pay your dues...let them know the reasons and hopefully you can save everyone time/money.

Rick

Hi Pavs,

When your listing agent sent "the package' to your mortgage servicer, they had to include a preliminary HUD-1 statement from the title company you chose contractually to close with. This statement will tell the bank what the estimated transactional costs are that will be part of their mitigation process. An experienced L.A. will put 6 months of HOA payment s on the HUD. In that way the servicer will have that number included.

As it relates to the lien: The lien is 'subordinate', however it is a lien and will have to be addressed and negotiated. This will show up when the same title company that created the HUD orders what they call the estoppels letter.

What your L.A. can do right now is get a 'statement of account' requested by you to your HOA. Once again an experienced L.A. will know how to do this. They will also inform the HOA's management company and attorney (if known) that the current property is in short sale mitigation and that any encumbrances should remain 'lien free' as to facilitate the expeditious closing and thus payment of any encumbrances owed on the property.
In a word – DON’T PROCRASTINATE. Call your L.A. right now and tell him to get to work!

There is no reason to call an attorney, it is not a 'legal matter' and it will only cost you money you don't have.

Happy short selling

Mike Luzzo

Pavs

In my short sale experience, Marty is right. It becomes a lien that has to be satisfied in order to close on the property. It may be paid or could be paid by bank, buyer, seller, agents or combo of whomever will satisfy the back payments in order to close. It becomes a negotiable item if and when the bank approves your sale and you should share this concern with your agent. If no on can or will offer to pay it could mess up your deal. Discuss with all parties now, no surprises at closing please.

It will be a lien but since you are in short sale (as stated below ) it becomes secondary to the bank. If you have any futher concerns there is no opinion that superceeds the advice of an attorney. Good Luck

Gay Middleton
Realtor
gaymiddleton@orlandohomeresales.com

Hi Pavs,

You need to make your agent aware of it so he can factor that into to discussions with your lender as well as letting the title co or closing agent know this info as well and a current figure needs to be received from the HOA regarding your arrears, late fees etc. From a practical point of view, this debt will have to be satisfied for title to convey. In some cases, your lender will absorb the cost, in other cases the seller would pay it and if your buyer is getting a good enough deal on your property and the overdue balance is not too great, possibly they would consider paying it. In one fashion or another, it will need to get satisfied. I would notify your HOA immediately that you have a contract on the property as a short sale and that debt will be satisfied at closing.

Best of luck.

Marty Kaiser
Keller Williams Realty
407-595-9700
Broker/Associate
Accredited Buyer's Representative(ABR)
marty@floridasells.com

The following is my opinion (based on experience); it's not legal advice.

If you can't afford to continue paying the HOA fee, then stop paying it. Sure, the HOA will put a lien against your property, but your mortgage(s) also have liens that would be superior to any lien that the HOA would put on the property. Plus, if one of your lenders foreclosed on one of your mortgages, then the HOA lien would get wiped out after the gavel has fallen, and the HOA would get $0.

Yet, you probably should get your agent, who's handling the short sale, (or the short-sale negotiator) to start calling the lender(s) daily to find out what's going on with your short-sale contract. You know . . . the squeaky wheel gets the oil.