Real Estate Law
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I am selling my townhome to a buyer with a fedally backed loan. The lender says the hoa has to have a insurance bond for the hoa and the management co. The hoa is making us the sellers pay for the bond. The buyers won't. Instead they want a credit in escrow for the amount. My question is-Is this legal? Response 1: Unfortunately, it is legal. Can the hoa make us pay when they are suppose to carry this bond.hey don't want anyone buying here that has a ferdally backed loan.
Response 2: Regrettably yes. You need the bond for your closing and not HOA. So, HOA has no incentive to assist you especially when they do not want buyers with federally backed loans. Unfortunately, if you do not get the bond, your closing would not happen, I am afraid.
I feel like I'm being harassed in this sense. I'm giving the buyers a credit and I'm paying for the bond too. Is that still legal? Can't I get any relief from this or am I just screwed?
Now, the HOA want us to reinburse them also for the bond. I found out the buyers lenders want indication that the HOA is getting the bond . I think the HOA told the lender they are buying it. They buyer wanted a two yera credit for the bond and won't release the last contengency until they get their loan, they are dealing with a bank. Do we have to reimburse the HOA now?
Now, the HOA want us to reinburse them also for the bond. I found out the buyers lenders want indication that the HOA is getting the bond . I think the HOA told the lender they are buying it. They buyer wanted a two yera credit for the bond and won't release the last contengency until they get their loan, they are dealing with a bank. Do we have to reimburse the HOA now? Response: NO. HOA cannot have it both ways. Either HOA purchases the bond and yor reimburse the HOA or your purchase the Bond and it ends there. You CANNOT pay for the Bond and also reimburse the HOA!!! What would you be reimbursing HOA? They did not pay for anything.
Your buyer needs to tell the lender what the HOA is doing. Someone needs to put a stop to it. HOA's action here is quite unethical and illegal for trying to get reimbursement for something that they NEVER PAID. If you HOA causes this sale by these illegal actions, you can file lawsuit against the HOA.
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