If you're selling a house or condo with a homeowners association (HOA), you will likely have to pay an HOA transfer fee.
HOA transfer fees typically cost between $100 and $400 — but the exact amount is determined by the governing HOA. The HOA transfer fee is a one-time charge and is different from regular HOA fees, which are due monthly or annually.
While transfer fees are typically low, it's not a guarantee. Many states have no regulations on HOA transfer fees, resulting in some HOAs charging very high fees.
If you're buying in an HOA community, it's a smart idea to use a good agent who can tell you what you're getting into. We recommend Clever Real Estate, which can put up to 0.5% cash back in your pocket at closing in 41 states!
What Are HOA Fees?
HOA fees are dues paid to an HOA, which is a private, self-governing body that oversees a neighborhood or building. HOAs typically provide some level of maintenance in exchange for your dues. HOAs also set rules about what you can (and can't) do with your property.
HOAs typically create uniform neighborhoods with control over things like grass height or exterior paint color. One of the main benefits is that no house can become garish overnight or display possibly controversial items (like political signs or flags). Breaking the rules can result in a fine — and unpaid fines or dues can result in a lien against the property.
What Is an HOA Transfer Fee?
An HOA transfer fee covers the administrative costs of transitioning HOA documentation from one homeowner to the next. HOA transfer fees are sometimes called HOA certification fees.
When a homeowner in an HOA sells their home, the HOA has to gather copies of all relevant ownership documents and transfer them to the new owner. These documents typically include any governing covenants, convictions and restrictions, rules and regulations, financial statements, amendments and property defects.
The HOA may also need to inspect the property for violations and make security changes (like creating new security cards, or resetting locks).
How Much Do HOA Transfer Fees Cost?
HOA transfer fees typically cost $100–$400.
Some states have caps on how much an HOA can charge for these fees. For example, in Texas, HOA transfer fees — also known as an HOA resale certificate there — are capped at $375.
But most don't — HOA transfer fees in California simply must cost a "reasonable" amount, but that "reasonable" cost isn't defined.
However, in California, HOAs can only charge costs related to procuring, preparing, copying, and delivering documents. California HOAs also must provide a transfer fee estimate within 10 days after the buyer requests disclosure documents.
In Utah, HOAs with less than 500 housing units are allowed to charge up to 0.5% of the sales price for something called a reinvestment fee. That is usually paid for by the buyer.
Other states may have additional regulations for HOA transfer fees. A good agent can tell you what kind of HOA transfer fee you can expect when buying or selling a home. We recommend Clever, which can connect you to hand-picked, top-performing local agents who can save you thousands of dollars. Home buyers in 42 states can receive up to 0.5% cash back at closing, while most sellers will only pay a 1% listing fee.
Who Pays HOA Transfer Fees?
The seller usually pays for HOA transfer fees. However, that's not a guarantee. A seller could negotiate with the buyer to pay for them, or a buyer could offer to cover the costs to sweeten their deal.
HOA transfer fees are usually due at closing. But if the HOA transfer fee doesn't show up as a line item on the closing document, these fees could be due after closing — if that's the case, the buyer is on the hook to pay for it.
Home Buyer Tip: Learn the Cost of HOA Fees Before Making an Offer
HOA fees are worth it for planned community homeowners who want a semblance of uniformity in their neighborhood. For homeowners of condos, HOA fees are necessary because they cover maintenance costs.
HOA fees can cost anywhere from $100 to more than $1,000 per month, and they vary by neighborhood, building, or subdivision. Generally, the more expensive the area, the higher HOA fees will be.
HOA fees typically cover:
Some HOAs are voluntary, while others are mandatory. HOA fees are due directly to the HOA itself and are not included in your monthly mortgage payment.
Some buyers like HOAs because they help make the neighborhood look good. Other buyers may not like the extra rules and costs that HOAs add to homeownership.
If you're selling a home in an HOA community, you'll want to play up the positives that your HOA brings to property value to justify the dues and also inform the buyer of any HOA transfer fees due at closing.
Selling a Home Can Be Confusing — But a Qualified Agent Can Help
Selling a home in an HOA comes with a boatload of paperwork — even more paperwork than selling a home without an HOA. We recommend using a good agent to help you keep everything organized — but we don't recommend a traditional agent that charges 2.5-3%.
Instead, we recommend our friends at Clever, who will match you with top-rated agents that can help sell your home for just 1%. You'll get the full services of a traditional agent at a fraction of the price! Best of all, there are no upfront fees, so if you don't like what Clever offers there's no obligation to continue. We're pretty sure you'll like what they offer.
What is an HOA transfer fee?
An HOA transfer fee is what an HOA charges to transfer all HOA-related documents over to the new owner. The HOA transfer fee can also include extra duties, like issuing security passes. Learn more about HOA transfer fees.
What are HOA fees?
HOA fees dues issued by an HOA can cost anywhere from $100 to over $1,000 per month. Those dues cover things like lawn maintenance, security and the upkeep of shared areas. Learn more what HOA fees cover.
Who pays HOA fees?
The property owner pays for HOA fees up until the home is sold. HOA transfer fees are usually paid for by the seller, although that's negotiable. Learn more about who pays HOA transfer fees.
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