Depending on the option chosen in Paragraph A of the Addendum for Property Subject to Mandatory Membership in A Property Owners Association (TXR 1922), a buyer may be able to terminate the contract within three days after the buyer receives the subdivision information (or until closing if closing occurs in fewer than three days). Some options in Paragraph A also stipulate that if a buyer does not receive the subdivision information at all, the buyer may terminate the contract at any time prior to closing. In either situation, the earnest money will be refunded to the buyer.
To protect sellers against lengthy periods when buyers can terminate based on this paragraph, agents can counsel their sellers to order the property owners association documents immediately after taking a listing. Doing so ensures the documents are received quickly, as procuring them can often take some time. Getting the documents quickly also lines up the buyer’s right to terminate after receiving the documents with the buyer’s option period. Even if a buyer forgoes an option period, having the property owners association documents on hand at the time of the contract execution will limit the buyer to three days in which to terminate and avoid a situation where a buyer has the right to terminate up until the closing.
As a Buyer Rep this issue has become more and more of a worry for me. I am seeing more and more a lack of transparency, an abundance of corruption, incompetence and naivete’ in the management and administration of HOA’s. In many of these communities the responsibilities that are upon a Board of Directors are increasingly complicated and time consuming yet there is no compensation for all of the hard work that is required to administer these organizations and oversight is difficult. Most Management Companies are not licensed, are not fiduciaries and do not answer to anyone except the Board.… Read more »
If you are getting a resale certificate at the listing just be aware it is only good for 30 days.
Where do you get the 30 days from? A condo resale cert is 90 days. I see no such dates on the POA form.
i recieved rules of hoa 1 year after purchase by neighbor
This just freaking happened to us. 1 week before closing. After we did all the menial repairs they wanted, which were extremely minor because the house is in great condition. They used this as a loophole to keep shopping for other houses. This is complete bull.
If the contract states the seller has 15 days to deliver the HOA documents and the buyer has 3 days after receipt to review them but they are delivered late, is the buyer still limited to 3 days to terminate or do they have any time prior to closing. My buyers are not looking for an out, but need to clarify lease restrictions and received the document late, now on a Friday with likelihood of being able to contract anyone at the HOA with questions over the weekend slim.
What if a Buyer does not choose any of the options in (A) on the HOA Addendum?