HOA transfer fees are getting some attention in the news again this week. In particular, news coverage has focused on demands that HOA property management companies provide invoices for the transfer fees charged to buyers or sellers of properties within HOAs. There is good news for buyers and sellers in HOAs: access to transfer fee information is already available.
What exactly are transfer fees? Colorado statutes address transfer fees in the three following ways that are relevant to HOAs and their members:
- The Colorado Revised Nonprofit Corporation Act expressly authorizes nonprofit corporations to impose transfer fees upon their members unless the articles of incorporation provide otherwise. Most HOAs are formed as nonprofit corporations and have this right to impose transfer fees.
- The real property statutes prohibit certain transfer fee covenants, such as those intended to benefit a person or entity who does not hold an interest in the property burdened by the covenant. But transfer fee covenants for fees payable to homeowner associations are not prohibited and are recognized by statute as valid fees.
- Community association management companies typically contract with the HOAs they manage to charge transfer fees to the buyers or sellers of properties within those communities. The community association manager statutes and licensing rules impose explicit requirements on managers concerning these transfer fees. Those statutes and rules are the good news for buyers and sellers, and all owners, who want to know what transfer fees apply in their HOAs.
So what rights do owners, buyers, and sellers have to access transfer fee information?
Continue Reading HOA Transfer Fees: Access to Information Available Now