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HOA Transfer Fees: What Title Companies Need to Know to Avoid Closing Delays

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In Colorado real estate transactions, HOA transfer fees can be a hidden hurdle that disrupts closings and frustrates buyers. For title companies, understanding how these fees work—and how to proactively manage them—is essential to delivering smooth, surprise-free service.

🔍 What Are HOA Transfer Fees?

HOA transfer fees are one-time charges assessed when ownership of a property changes hands. These fees are typically used to cover administrative costs associated with updating records, issuing welcome packets, or onboarding new owners.

While they may seem minor, transfer fees can range from $50 to over $500, depending on the HOA. If undisclosed or unpaid, they can delay closings or lead to post-sale disputes.

🧭 Why Transfer Fees Matter for Title Companies

  • Disclosure Requirements: Colorado law requires sellers to disclose known HOA fees, including transfer fees. Title companies must ensure these are included in the settlement statement.
  • Escrow Implications: If the fee is disputed or unpaid, escrow may need to hold funds until resolution.
  • Client Experience: Buyers caught off guard by unexpected fees may lose trust in the transaction process.

📄 How to Identify Transfer Fees Early

Using COCRS’s HOA Document Services, title companies can:

  • Review CC&Rs and fee schedules for transfer fee clauses.
  • Check status letters for any pending charges.
  • Contact HOA managers directly for confirmation.

🛠️ Best Practices for Managing Transfer Fees

  1. Include Transfer Fees in Title Commitments: Clearly disclose them to all parties.
  2. Verify Payment Responsibility: Determine whether the buyer or seller is responsible.
  3. Escrow Funds When Necessary: Avoid delays by holding funds if payment is uncertain.
  4. Educate Clients: Provide a brief explanation of the fee and its purpose.

🤝 How COCRS Can Help

COCRS simplifies the process by:

  • Retrieving governing documents that outline fee structures.
  • Providing contact reports to reach HOA representatives.
  • Offering status letters that confirm all financial obligations.

✅ Final Thoughts

Transfer fees may be small, but their impact can be big. By proactively identifying and managing them, title companies can protect clients, prevent delays, and enhance their reputation. With COCRS, you have the tools to make HOA fee management seamless.