Know Your Real Estate Terms. What is an HOA Fee or Assessment?

Definition time! Today’s lexicon is “HOA Fee.”

HOA Fee stands for Homeowners Association Fee and it’s an obligatory monthly fee paid by homeowners in certain types of residential properties.

You may see this at closing as part of your buyer’s expenses and or a proration. Your cloning agent or Title Company will order an “Estoppel Letter” from the HOA management company. This document will show what HOA fees have been paid and if any assessments are due or past due. Your closing company will prorate annual fees between the buyer and seller. You may see this proration on your closing statement if the property is in an HOA community.

AMG offers services to assist with resales and documentation required by some attorneys or lenders. We're here to assist professionals representing buyers or mortgage companies requiring essential real estate data and documentation for association real estate transactions.

The Homeowners Association (HOA) collects the fee and uses it to improve the community. Condominium association fees generally pay for maintenance of the grounds and common areas, the exterior of the building, insurance, swimming pool, clubhouse, and/or other amenities. In many instances, the condo fee includes services such as garbage and water.

From the smallest condominium to the largest lifestyle community, resident amenities are a fundamental advantage to living in a community Association. These amenities may be as grand as golf courses, lakes, and pools or as humble as a unique sitting area. No matter how large or small the amenities, prompt, proper, and cost-effective operations are vital to that community.