Home Selling in Laveen>Question Details

Dewaine, Home Seller in Phoenix, AZ

Can past due HOA fees still be paid in short sale?

Asked by Dewaine, Phoenix, AZ Tue Apr 29, 2008

HOA have a townhouse and it has a lien on it for past due HOA fees. We are in the process of trying to sell the property and maybe even a short sale . I would like to know if the lien will hold up the sale or will the HOA come after me by garnishing my wages.

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In the short sales that I have participated in, a few times the banks have paid the back HOA fees and fines. Of course, ever bank and situation is different. During the negotiations with the lender(s) will be the only way to accurately determine what will happen.
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0 votes Thank Flag Link Wed Feb 18, 2009
The lender often will pay the HOA fees when a new buyer purchases the property. PLease seek legal advice and infomation from a tax advisor too. I wish you luck it is a hard time for many home owners!
0 votes Thank Flag Link Tue Apr 29, 2008
I'm not a lawyer...

However, I attended a seminar on this just the other day. And the answer was "it depends" on how the HOA fees are collected, if they are at all. Again, I'm not a lawyer, so this is not legal advice. However, if the property is sold and it isn't a short sale, then all liens (including the HOA fees) would have to be paid in order to have a clear title. On the other hand, if it is a short sale, the lien probably would be wiped out. The "horror stories" I heard at the seminar were of the new purchaser, who'd bought the property, being pursued by the HOA for the fees. Not that (at least in this case) they had a legal basis for doing so, but it could still make the new owner's life miserable.

So, check with a lawyer. It really depends on when the lien was filed, what order it's in, possibly what your HOA documents say, what your local law is, and more.

Good luck.
0 votes Thank Flag Link Tue Apr 29, 2008
Don Tepper, Real Estate Pro in Fairfax, VA
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