Extra Fees May Come As Surprise to Home Sellers & Buyers

Submitted by Vicki Owens, ABR, CRS, GRI, SFR, Best Homes Real Estate, Marysville, Ohio

Heads up to owners with homes on the market or anticipating a future sale in 2011. If you live in a newer home in a subdivided community, you may want to read the fine print from your builder about transferrable warranties as well as from your Home Owners Association about transfer fees.

If you live in a community that has a Home Owners Association, you may be paying fees annually, quarterly or even monthly to your association to care for common areas of your neighborhood. But did you know that when you go to sell your home, your association may likely charge a "transfer fee"? For years this has gone on with condominium communities and was expected. As more and more neighborhoods turn over responsibility for the operation of their association to professional property management companies, we are seeing these fees be put into place. Anywhere from $50 to $300 that will be the responsibility of the home seller. For what? To change the owner name in their database. Also, with lenders being more stringent in underwriting, we are seeing more and more fees also charged to them for documents held by the association, like rules, covenants and insurance policy records. If you receive notice about your home owners association, you may want to check this out and get a run down of extra fees they may have in place. If you have a recent addition of an HOA in your community, it is important that you read the fine print and details. It may sound like a drop in the bucket right now, but when you start adding up the costs to sell your home, this can make a difference.

Do you have a transferrable builders warranty? Some builders have recently put into place a transfer fee for the new owner to take over the warranty. Typically, the new owner would complete a card or go on line and register as the new owner with the home builder at no charge. These warranties are generally 20 to 30 years from the date of build and cover the structure and sometimes dry basement. A nice peace of mind thing to have and valuable selling tool for an owner. Now, a seller may end up spending $200-300 to transfer this warranty. It is worth making a call to your builder's warranty department to find out if there will be a fee. Certainly you do not want a detail like this to hold up the sale of your home.

If you are a home buyer, especially if you are looking at foreclosed properties, you want to check into these things where community and warranty are concerned. With home owners associations specifically, many do not file liens against the property that can be found by a title company prior to the home sale. So later, you get a letter or even a certified letter or a lien from an association that you may not have known even existed. They could be expecting you to pay transfer fees, back dues, late fees, etc. after you are in the home. We are seeing this more and more where new owners get this unwelcomed surprise. The banks have new owners sign many waivers and will not take responsibility to disclose this information to the buyers. And since a lien is not filed, it would likely not be covered by title insurance. Know that back association dues are a risk taken with foreclosed and short sold properties. Even agents have no true way to find out about this prior to the close of sale. Do your research on the neighborhood if possible prior to closing and see if funds can be escrowed for these fees and fines. In addition, do not assume that a builders warranty will automatically transfer with the home. If it is newer and you think their may be a warranty still in place from the original builder, call their service department directly to question this and find out about transfer and if there are any fees for that. Many home sellers may not be aware that there is any fee for the transfer leaving it to the buyer to pay after the sale to continue the warranty.

It is a jungle out there. With sales down and companies looking for new income streams, it is always good to do your homework so as a seller or a buyer, you are an informed consumer. There is little regulation on these types of fees, if any. And when it turns into a considerable amount that is in question, it can become a real headache that may even land in court. Real estate contracts become more and more complicated every day especially with a variety of attachments. You should consult with an informed real estate attorney when you are selling or buying to be aware of the details. Attorneys can interpret for you the fine print within contracts, waivers and addendums so that you are sure you are well informed of all costs and risks involved. Your Realtor should always advise you of your rights of attorney review and keep your best interest in mind.

Vicki Owens, ABR, CRS, GRI, SFR is a trusted resource in the Marysville, Ohio area and owns and operates the branch office of Best Homes Real Estate. Since 2003 she has been serving the Marysville and Central Ohio areas both as a listing agent and buyers agent. A multi-million dollar producer, Vicki actively stays in touch with the local market and changes effecting the industry. Contact her by phone at 614-440-5174 or 937-644-3385, A native of the Columbus area and Marysville resident since 1999. You can find reliable, informative resources on her website www.movetomarysville.com