A resale certificate or closing letter provides specific information about the home you are purchasing and its standing within a given community association. Typically, a Resale Certificate is a set of documents that a homeowners or condominium seller provides to a prospective buyer, usually after mutual acceptance. The certificate typically includes the homeowner’s association budget, the Covenants, Conditions, and Restrictions (CC&Rs) for the association. It usually includes information on any past due payments to the association, pending violations, unpaid violations. Plus, any unpaid special assessments and fees that are due upon closing.
Using ReadyRESALE Web Base software to manage your HOA document needs allows your team or board members and even residents to access the information they need from any device, 24/7.
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Resale certificates and packages offer transparency about the community and whether or not the sellers are current in their financial obligations to the association. The resale certificate protects all parties involved by allowing sellers to disclose their standing with the HOA, POA or COA, letting buyers know that the HOA they are joining is financially sound, and minimizing financial risk for the HOA. It ensures that if the seller isn’t up to date on payments, it can become the buyer’s responsibility after a certain about of time and the association won’t be left unpaid. In short, the resale certificate reduces liability for the HOA if the seller isn’t up to date on payments.
After a home is signed for, most states require that the seller provides the resale package to the buyer. There are variations again depending on your location.
Your local realtor or broker and the property management company of the community will be your best source of information on how to purchase or obtain a certificate. An association can certainly provide some information like a copy of the governing documents to any potential buyer along the way but remember a realtor won’t know if the current homeowner is up to date on their dues, for example, which is why the seller is legally required to disclose that to a buyer within the resale package.
Purchasing a resale package isn’t difficult. In self-managed communities, the seller can request it from the property management office or many times it can be purchased online through their website. The fees for a resale package vary from state to state and sometimes by community or association. Some states limit the amount associations can recoup for the time and cost of producing the packages.
The cost of a package or certificate offers the buyer peace of mind and it reduces your liability if the seller hasn’t made all association payments and isn’t up front about it.
ReadyRESALE enables your management company and other real estate related services such as title companies or real estate agents to request necessary documentation required for a resale package, property closing or refinancing in a secure online environment.
Our cloud-based application provides you unparalleled flexibility and automation while you retain complete control of the document management process. ReadyRESALE offers you an easier way to organize, collect and vend your documents with a click of button. Take back control over your outdated processes and help you, your staff and company automate your resale packages and certificates.
Because the association’s property management company handles the accounts receivable for the association and has the rest of its accounting information handy as well, the management company will complete the certificate as a service to its clients.
Resale certificates and resale packages might sound complicated, but they are an important tool in closing negotiations and for the peace of mind of everyone involved in the transaction. From the seller’s obligations and allowing the buyer to know all about the community they are joining and finally it gives the association board info if there are any account delinquencies. They are crucial in keeping the process as transparent as possible.