Documents & Transfer Fees

Our managing agent handles the requests from escrow agents when any of our owners sell their units. The managing agent has set the fees, not our HOA. The fees are billed by and received by the managing agent. Our HOA has zero participation. The managing agent is charging $495 for a "documents" fee and $750 for a "transfer" fee. Is this unusual, to have TWO fees, especially when the second fee is very high.

By way of contrast, Florida sets a limit of $100 that may be charged as "transfer fees" and the authority to collect such must be in an HOA's governing documents. Unscrupulous parties have attemped - and often succeeded - in charging much, much more than that. I'd agree in a heartbeat that the $100 limit is way too low, but it is what it is until the legislature changes it. I'm not familiar with how all that works in California, but over a thousand dollars in multiple fees sounds excessive.

In Texas, self managed HOA,

$100 Resale Certificate
$25 HOA dues request
$100 Transfer fee (due within 14 days of closing)

The first two are payable up front
due to some title companies not paying
at all.

John

Why should the HOA see "any of it"? It is the management company which must prepare the documents, field the telephone calls, email, and form completion request. All the expense is incurred by the MC, not the HOA or condo association.

This is a profit source for management companies. I've worked for several, and they all charged somewhere between $300-$750 for the resale package, depending on how quickly the seller wants it. Transfer fees $100-$250.

There will usually be a department or at least a designated employee that does nothing but handle resales and the fees offset the cost of those employees.

And, generate profit. I get why people don't like to pay but...it's capitalism, y'all. Management companies are in it to make money, like every other business owner.

Most people I know would consider a "transfer fee" as a fee moving the records of a property address from one owner to another. We can argue what is an appropriate price until both are blue in the face, but it is a legitimate fee.

I agree it is legal but capping it at $100.00 is to little while in the case of the OP the bottom line was $1,200.00.

Barbara

In our experience, the preparation of the Resale Certificate Documents, creating a new owner account in the accounting system, and preparing a welcome package takes only 60 to 90 minutes. The expense driver for us the amount of time we subsequently spend interacting with and answering questions from agents, lenders, the title company, inspectors, the seller, sometimes the buyer, sometimes contractors, and others. Also, the additional forms we are asked to complete require time.

We tell our client boards about the Resale Certificate Preparation charge, we also explain it to the buyer as soon as we learn a property has been listed for sale.

Since the associations we manage do not benefit from the preparation charges, they are not deriving any additional income from the process. We last took on new clients 11 months ago, we asked to see their balance sheet and ACORD for the D&O insurance before we got too far into the discussion with the potential clients as we have learned the hard way it generates too many headaches to take on clients who do not have the proper insurance or adequate funds in their operating and replacement/reserve accounts.