Are HOA Management Companies Simply About The Money?

Greedy Business PersonI’ve been working with a seller for several months. She is battling Stage IV cancer and has moved to another city for treatment.  We listed her local home and quickly had a contract on it.

As part of the sales process, an HOA Resale Certificate had to be ordered from the HOA via the management company hired by the HOA to manage their day-to-day operations. Their “processing fee” for producing this document was $325.

This sale took a turn for the worse when the lender denied the buyer’s mortgage. This was not the lender’s fault but rather the fault of the buyer who refused to cooperate and provide documents required by the lender. Either way, we had to go back on the market.

We got the property under contract again and the sale is set for February 8th.

Yesterday I receive notice that the management company is turning my seller’s account over to collections on February 1st for non-payment of the processing fee.

I emailed the management company explaining the situation and received a curt response with the text of their agreement. Basically, the fee is due within 30 days of the sale or within 90 days of the request.

I understand the fine print but the seller is not in the area and battling cancer so I sent them back a note asking for an exception to their policy and letting them know that I would personally be responsible for the payment if the sale did not close on February 8th and the seller did not pay them.

This time a member of management responded with another curt response

“This notice was sent as a courtesy since it has been over 90 days, it has been almost 120 days we can only hold the order until February 1st after this day the account is no longer with us and it will be handled by NECS, the collection agency. As stated on our agreement on line, the requesting party is responsible to ensure payment is received within 90 days even is contract is terminated.”

I went ahead and paid the processing fee for my seller. I simply cannot allow this to go to collection and have an impact on a closing set for next week. The seller is under enough stress and does not need this over $325.

Legally the management company is within their rights to enforce the terms for receipt of their processing fee. Ethically, I find it hard to believe that the HOA and their management company would not be willing to work with a homeowner who pays her dues and is fighting for her life.

Are HOA Management Companies Simply About The Money?

Tom Branch, Broker, CDPE, SFR

Photo Licensed from iStockPhoto

About Tom Branch

Tom Branch has written 597 posts in this blog.


Have you ever just met someone, but felt you like you'd known him for years? That's what most people experience with Tom. He has a knack for making folks feel right at home. After 21 years in the Air Force, loyalty and honesty are the foundation of everything Tom does. In addition to being a Texas Real Estate Broker, Tom is a Certified Distressed Property Expert (CDPE) and a Short Sales & Foreclosure Resource (SFR).

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