The Importance of Reviewing Financials of a Homeowners Association

8/11/14 - In the sale of a condominium or townhouse it is especially important to obtain the most updated version of the documentation from the Homeowners Association (HOA).

While the cost to obtain these documents may appear to be high, it is important that the Buyer receive these documents for their review and approval. This ultimately protects all parties from any possible future concerns or issues which may arise after the close of escrow.

The HOA package will include the CC&R’s (Covenants, Conditions and Restrictions) filed against the property, the Articles of Incorporation of the complex, its Bylaws, Rules and Regulations, Budget, Minutes of Board Meetings and the Financials.

In today’s economic environment it is especially important to carefully review the Financials of the Homeowners Association, which will indicate the financial strength of the Homeowners Association and its ability to maintain and pay its overhead. The HOA’s ability to pay insurance policy premiums, utilities for common areas, etc. plays a key role in determining whether this complex is right for you (and whether your new Lender will also find this complex a good investment to make a loan on.)

TIP. When reviewing the financials of a Homeowners Association it is imperative to determine whether there are any units which are delinquent in paying their HOA Dues (or units in foreclosure). Paying close attention to how many months any particular unit is behind in their payments (and especially the total amount of units in arrears as well as the cumulative amount of the combined unpaid HOA Dues) is of significant importance when considering a purchase in any particular complex. Unpaid dues can place an unwelcome financial burden on the rest of the homeowners.

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Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

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Brochure - Your Escrow and You

7/9/14 - Here is a very informative paper as originally released by the Escrow Institute of California many years back and which continues to be relevant today.

http://www.sepulvedaescrow.net/pdfs/Your%20Escrow%20And%20You%20(PDF).pdf

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Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

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Opening Escrow

6/28/14 - It is very important to only open escrow AFTER all terms of the transaction have been agreed upon by Seller and Buyer.

Whether working with a Real Estate Agent or the Sale is negotiated directly with the Owner, often referred to as a For Sale by Owner (FSBO), it is very important to discuss and agree upon all terms before opening escrow, specifically so Seller and Buyer will not have to negotiate on additional matters after they have signed escrow instructions.

It is important to understand that escrow instructions are a legal binding agreement which can only be changed or amended if the Seller and Buyer both agree on the exact changes. Avoiding disagreements is very important. Doing so will help close your deal as planned, so everyone wins!

Obviously there are times further negotiation cannot be avoided, due to perhaps something unexpected, though once again always best to make every effort to anticipate as much as possible ahead of time and use the Agreement to fall back on.

TIP. Before signing a Purchase Contract, Agreement or Escrow Instructions go over the documents with your Real Estate Agent, Lawyer or Escrow Officer. While your Escrow Officer cannot give you legal advice, they very well may notice a problem in your Agreement which they can bring to your attention and give you the chance to talk about it with the other party before you sign Agreements to open escrow and obligate yourself to the legal and financial commitment called for.

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Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

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What is Escrow?

6/21/14 - An Escrow can be used for many different reasons.

An Escrow holder, sometimes referred to as a Settlement or Closing Agent, depending on what part of the country you are in, holds Written Agreements, Documents and Monies, which are only released when all terms of the Written Agreement have been complied with.

Agreements and Instructions in Escrow must be mutually agreed upon by all parties (Seller and Buyer), otherwise an Escrow Holder simply continues to hold documents and funds until mutually signed Agreements are received.

TIP: It is always best to have all agreements documented from the very beginning rather than change the agreements during the escrow. It is possible that later the Seller and Buyer may not agree on the matter which can create problems with moving forward to close the deal. This should be avoided at all costs!

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Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.
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