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We are in the process of buying a condo with a very large monthly HOA. In addition to the seller paying closing costs at the max allowed can they, as part of the contract , pay the HOA fees in advance directly to the association ? They have agreed to this but we are not sure if the lender will allow if it's in the contract. I know I can also lower the price by the amount in question but would rather have the credit with the building. Thanks
This depends 100% on your lender's policy regarding reviewing the seller's side of the closing disclosure. I have worked for some lenders that will do this all day long, others will not. It is supposed to be 6% on FHA but there is a gray area we often get exceptions on if it's over 6% if it is "standard and customary". If the HOA bills 2 times a year or quarterly, it would fit this. If monthly, it would not, but it sounds like they don't bill monthly otherwise the seller wouldn't have paid in advance.
What did the lender say/do?
@800goal800 wrote:We are in the process of buying a condo with a very large monthly HOA. In addition to the seller paying closing costs at the max allowed can they, as part of the contract , pay the HOA fees in advance directly to the association ? They have agreed to this but we are not sure if the lender will allow if it's in the contract. I know I can also lower the price by the amount in question but would rather have the credit with the building. Thanks
What kind of loan? What percentage are you asking for?