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RobertB29
(Florida)
Posts:3
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| 07/21/2010 12:14 PM |
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Our board authorized by board vote a $250.00 application fee on the transfer of the property. This fee is being charged whether or not any document are copied and supplied to the buyer. I could understand a fee for preparing documents upon the Buyers request, but this is a general capital contribution fee and charged whether or not the HOA provides any document to the Buyer. I looked at both the HOA’s bylaws and Declaration of Covenants, Conditions and Restrictions (CC&R). Neither document state anything about a transfer fee due on sale.
The fee was imposed by an Administration Resolution of the Board of Directors.
When I look at the Declarations it states the board shall fix the annual assessment at an amount not in excess of the maximum. The Board may levy a Special Assessment if the 2/3 the members agree, the Board may impose a special assessment against an Owner for the cost to repair any damage or injury to the Common Areas caused by the Owner. But no where do I see the board has the right to impose a Transfer fee. Buyers are going to be upset to find out they have to pay a transfer fee that is not even in the Covenants or bylaws. In my opinion if the Board should raise the assessments and not impose special fees.
What is the opinion on a Board authority to impose such fees when they are not mentioned in the bylaws or Covenants?
Robert
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DonnaS
(Tennessee)
Posts:5671
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| 07/21/2010 12:28 PM |
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Robert,
In the last 5 years, I have sold or bought 5 places in Florida and every transfer has included a fee, some were less but normally $250.00 was charged. Believe it or not, the Boards are required to supply documentation to the lending institution, Title search companies and the prospective buyers with proof of clear financials on any named property. They check for leins, unpaid HOA fees, leins and forclosure on the HOA property and numerous other charges. This is normal but probably not in your HOA documents. Sorry but it is a legutimate expense to the transfer of a deed. Covenants state that the Board must have financial responsibility to lenders. It is in your some where |
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SteveM9
(Massachusetts)
Posts:1442
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| 07/21/2010 1:13 PM |
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What is the opinion on a Board authority to impose such fees when they are not mentioned in the bylaws or Covenants?
Makes sense to have the fee.
If the board has to pay a mgmt company/accountant to prepare the financial docs to a lender, mail them, etc, they obviously cant do this for free. Someone has to pay, and you don't want to pass that cost to everyone in the association. Therefore it makes sense for the buyer or seller to pay it. |
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RobertB29
(Florida)
Posts:3
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| 07/21/2010 2:01 PM |
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If the lenders were provided such documents a fee for that should be charged. But this fee is charged even if a buyer pays cash or buys at a foreclosure sale and absolutely no documents are provided to lenders title companies, buyers or anyone else. I do not see where the covenants state that the Board must have financial responsibility to lenders, but if it does and there is no lender involved how can this fee be charged.
I am origninally from MD. There if a person or company request document the HOA can charge you for providing those document, which makes sense to me. But this fee is charged as a Capital Contribution fee and charged whether or not documents are provided to anyone. It is essentially another cost to someone buying a home. This is one more cost to the Sellers because the Buyers are not going to want to pay this unexpected fee.
What Happened to HB 115, which was prohibiting Transfer Fees?
Thanks in advance,
Robert. |
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DonnaS
(Tennessee)
Posts:5671
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| 07/21/2010 2:31 PM |
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Robert,
It is what it is. The HOA also has to record any new members to whomever does your maintenance fee billing, security and basically needs to document the transfer of the property . I did not see where HB115 passed with the transfer fee |
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PeterB1
(Florida)
Posts:254
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| 07/22/2010 12:49 PM |
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We (HOA in Florida) charge an Estoppel and Transfer fee of $150 for every sale of property. Before we instituted the fee, we consulted with out accounting firm. The assured us that the $150 fee is reasonable and customary in Florida.
We are required (and you probably are also) to provide copies of all governing documents to buyers. Our accountants do the paperwork and bill the title company. We have never had a problem - or even a query.
Whether your Board is authorized to charge a fee is (should be) detailed in your governing documents.
peter
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MaryA1
Posts:0
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| 07/22/2010 4:20 PM |
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| Charging a transfer fee, disclosure fee and even a preservation fee seems to be customary. Here in the Phoenix metro area, all the mgmt co's charge a transfer/disclosure fee which is paid directly to them. Some assn's tack on their own transfer fee. And, then there are the assn's that tack on a preservation fee(or some such name whereby the monies are deposited into the assn's reserve fund). These preservation fees can be quite high -- $500, $600, $700 or more. IMO, the preservation fees should be prohibited and the other fees should be limited to a standard $50 or $100 fee; to just the copying charge for the copying of the disclosure info; or a combination of the two. |
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