June 2023 Newsblog

(Real questions sent to us – verbatim!)


What if the HOA of a property I am buying gave a statement to the escrow that they need the new homeowners to pay the monthly dues for the whole year in advance instead of monthly? Do I need to comply with that? Will the escrow refuse to close if I refuse to comply? Does the HOA have the right to demand that?

ANSWER: Who is a party to the escrow?

Every escrow company makes different management decisions when processing a transaction in which something like this comes up. Here are the questions they should ask first: 

#1 – Who is a PARTY TO THE ESCROW? Only the Buyer and Seller are a party to the escrow. Not even Real Estate Agents are; they are only the Parties’ representative.

#2 – Is the HOA a party to the escrow? No, they are not. 

So, if a Party to the escrow refuses to pay a bill from a party who IS NOT, will that affect the closing of the transaction? Depending on the bill and who is objecting, it should not. The escrow should go forward and close, but a good escrow officer will memorialize the refusal of payment of the bill in an amendment for parties to sign. 

In this particular case here is what the Escrow needs to consider:

  • The HOA is a third party to the escrow.
  • The Buyer did not say he was not paying the HOA dues, just that he refused to pay the whole year at one time.
  • How is the Escrow Officer going to force the Buyer to bring in more money to pay in order to close escrow?
  • Does the HOA have anything in their Bylaws or Meeting Minutes that states a whole year has to be paid in advance? If so, was the Buyer given this document for review?
  • If escrow does not close due to this issue, the Seller may claim that he is being penalized for actions of the Buyer and a third party. That is not a good scenario which we want to avoid at all costs. 


  • Escrow – prepare an amendment in which Buyer acknowledges that he will not pay a year’s worth of payment in advance and will hold Escrow harmless of further liabilities that might arise from the HOA
  • HOA – Do you have the legal right to ask for a year’s worth of payment in advance? 
  • Buyer – If HOA insists it has the legal right, pay it to close the transaction and consider taking the matter to an attorney for legal action against the HOA after close 
  • Seller – Did you disclose to the Buyer at the opening of escrow of this HOA requirement? Disclosure laws are important and you may have some responsibility for non-disclosure. Contact your Real Estate Broker and get legal advice.


~ Video of the Month ~ 

(Even I can do this! My favorite repairs starts at 2:01 sec)

Using Super Glue and cotton to make household repairs.


~ Quote of the Month ~ 

With all this hype about AI and ChatGPT, a return to the BASICS:

Programmer – Someone who fixes a problem you didn’t know you had in a way you don’t understand.

Software upgrade – The art of putting new bugs into a program while fixing old bugs.

Hardware – the part of the computer which you kick when the software malfunctions.



If you haven’t had an opportunity to watch – 

Escrow From the Trenches – Six Part Attorney Seller Drama

Part 1No Instructions, No work! 

Part 2 Blue Ink versus Black Ink

Part 3 Yes! We Need The Originals!

Part 4 – Original Or A Copy?

Part 5 – Who Can Sign Another Original?

Part 6 – Trusting Your Overnight Service!


You Have Questions? We Have Answers!

“Escrow is my FOREMOST language!”

Advance Disclosure:
The opinions expressed in this blog are solely the author’s. 
Your comments and viewpoints are always welcome.
Info @ VivaEscrow.com