Navigating the intricate landscape of real estate transactions, as title and escrow professionals know, can get complicated. Orchestrating property closings …
For title and escrow professionals, every transaction comes with layers of financial details that must be explained clearly to clients. Among them, HOA fees and expenses are some of the most common sources of confusion at closing.
Understanding how these fees are structured and what they actually cover helps your team ensure transparency, manage client expectations, and prevent delays in the closing process.
HOA fees (sometimes referred to as assessments or dues) are recurring payments made to the homeowners’ association that manages a property or community. These funds are used to maintain shared spaces, cover operational costs, and build reserves for future projects.
When working with HOA-governed properties, title and escrow officers must verify the property’s standing with the association and confirm whether any balances, delinquencies, or pending assessments could affect the transaction.
Each association handles fees differently, but here’s a breakdown of what HOA dues generally include — knowledge that’s vital when reviewing HOA documents during closing.
These dues often fund the upkeep and availability of exclusive amenities like pools, exercise areas, and other unique facilities.
HOA fees contribute to the maintenance of shared spaces such as building hallways, lobbies, staircases, and patio areas.
These fees cover essential utilities like water, power, and gas for common areas. In some instances, they may also include utilities for individual units.
A part of the dues is allocated for essential services like trash removal and sewage management.
HOA dues fund pest control in common areas and the landscaping of green spaces, ensuring a pleasant and healthy living environment.
In areas with snow, these fees cover snow removal. They also contribute to the upkeep and management of parking lots.
A portion of the dues goes into the HOA’s reserve fund, a savings account for future significant projects, repairs, or emergencies.
HOA dues provide insurance against natural disasters and general liability for accidents or injuries in common areas.
Having a clear understanding of how these categories appear in HOA documents helps you flag discrepancies early and avoid post-closing disputes.
The amount of Homeowners’ Association (HOA) fees can vary significantly depending on multiple factors. They can start at $50 or less per month and reach thousands of dollars.
Here are the main factors that determine how much the HOA fees would be:
Educating future buyers about the range of HOA fees is vital for Escrow officers, as it ensures buyers are prepared for all financial aspects of homeownership. That, in turn, facilitates smoother, more transparent property transactions and builds trust.
If your customer is considering buying or selling a home located within a homeowners association, the sales process can seem a bit daunting. The paperwork alone is intimidating.
But what surprises most potential buyers are fees incurred throughout the sales process that regular HOA dues do not cover. As an Escrow officer, you’ll likely be responsible for explaining the additional HOA fees as well.
Here are some HOA fees that fall outside the normal monthly dues.
Unlike other homes, additional disclosure rules and documentation must be provided and reviewed if your client is buying or selling a home within a homeowner’s association. The law offers buyers a window of time to review the HOA documents and assess the HOA’s financial condition before finalizing any sale.
Specifically, buyers have a right to review the ‘HOA’s covenants, codes, restrictions (CC&Rs), bylaws, and financial history. However, having the homeowners association prepare these documents does incur tangible costs, including time and physical resources. The HOA may assess a fee for providing this documentation outside the standard dues a homeowner would pay.
Other fees, similar to purchasing documents that an HOA may charge outside of standard dues, are estoppel letters.
When the home is in a homeowner’s association, the lender will likely request an estoppel letter that outlines any outstanding balances or fees the seller may owe to the HOA. If there are unpaid fees, an HOA could end up putting a lien on the property.
Most homeowners associations charge a fee to prepare this letter or certificate.
Real estate investors or owners who want to rent out their HOA-governed unit might face a few challenges. For one, the HOA may have additional restrictions and applicable fees outside the regular dues.
A legal precedent confirms it is permissible for HOAs to charge annual application fees for units intended to be rented out to lessees. Other types of fees that homeowners’ associations can charge for renting, in some states, are screening fees and move-in and move-out fees.
Fees associated with rentals have become a hot topic over the last few years, especially for those located in growing vacation hot spots or used as short-term rental properties.
Understanding what drives HOA fee fluctuations can help your clients make informed decisions — and help you anticipate document review questions during closing.
When reviewing HOA budgets and financial statements, pay close attention to reserve fund health. Low reserves often indicate the possibility of special assessments that could impact future buyers.
A reserve study provides insight into the HOA’s long-term financial planning — a key document for title and escrow teams. It shows whether the association is adequately funded for future repairs and major expenditures.
Special assessments are one-time charges levied on homeowners to cover unexpected expenses or projects not covered by the reserve fund. If an HOA frequently issues special assessments, it may signal underlying financial instability that’s worth communicating to your clients.
For professionals managing closings, HOA fees are more than just line items. They influence final settlement amounts, lender payoffs, and client satisfaction.
Tracking down HOA documents, verifying fees, and confirming account balances can take time — and each day matters when closings are on the line.
That’s where Rexera steps in. We combine the industry’s most comprehensive HOA database with automation and expert verification, so title and escrow professionals get accurate, complete HOA documentation faster — with no last-minute surprises.
One of the most common causes of closing delays comes from HOA payment bottlenecks. Many title and escrow teams lose valuable time waiting for sellers to approve or complete payments for HOA documents — especially in states like Texas where sellers are legally required to pay these fees before closing.
Rexera’s Seller Pay First (SPF) functionality was built to remove that friction entirely.
When an order is submitted, Rexera sends the seller a secure, branded payment link via Stripe, allowing them to pay the HOA document fee directly. The payment process is transparent, safe, and fully managed by Rexera — including follow-ups and reminders.
Once the payment is completed, the document order begins immediately, eliminating delays and ensuring the closing stays on track. The title company receives a $0 invoice for the order, as the seller has already covered the cost.
For clients who prefer a different approach, Rexera also offers a Prepay option, where Rexera advances the document fees upfront. The title company simply reimburses Rexera at closing, either per file or through consolidated weekly or monthly billing.
Both options were designed with one goal in mind — helping title and escrow teams avoid payment-related slowdowns, reduce administrative workload, and deliver smoother, faster closings.
Navigating the intricate landscape of real estate transactions, as title and escrow professionals know, can get complicated. Orchestrating property closings …
As an Escrow officer, dealing with HOA documents for closing might seem like a mundane and repetitive task. However, it …
Ensuring a quick and consistent closing for clients is key for title and escrow companies that want to remain competitive …
