Saturday, February 8, 2014
CAR Remains Silent on HOA Transfer Fee Bill?
The Colorado Association of Realtors (CAR) has been oddly silent on a Bill before the legislature that would benefit the folks that pay their salary: home sellers and buyers. The HOA Transfer Fee Bill, HB 14-1254, was intended to place a dollar limit and restrictions on the transfer fee imposed on home sellers by property management (PM) companies when a home is sold in an HOA (Homeowners Association). The non-negotiable fee must be paid by HOA home sellers or they can't sell their home. The fee is not limited in amount, ranges from $50 to over $1000 with no relation to additional costs incurred due to the sale of the home, and is not a legal requirement. The real estate industry has tacitly approved of this abusive practice. . The fee costs HOA home sellers/buyers $15 million a year. The transfer fee is supposedly for services related to: 1) Issuing a Status Letter indicating the sellers outstanding financial obligations with the HOA that is mostly a reflection of their routine monthly bill and already paid for by the seller through HOA fees. Many HOAs complete this for $50 or less or for no fee. and 2) Changing records in the HOA data base similar to when someone gets divorced, marries, or dies and also already paid for by HOA dues. So what is this fee really about? PMs use the fee to supplement income, increase profits, and it allows them to under bid and win HOA contracts with the anticipation of transfer fee income. Unfortunately, all the verbiage in this Bill that would rein in this abusive fee has been taken out at the request of those who pocket the money and CAR has remained silent. If CAR understands who pays their bills and puts bread on their table they should stand up and defend home owner interests and work to change this Bill to rein in abuse.