What is an HOA resale disclosure packet?
Under Virginia law, buyers who sign a purchase contract to purchase a home that’s either in a condo or an HOA neighborhood must be provided the resale package from the seller. The resale package must be given to the buyer in a timely manner after the contract is ratified. The buyer can cancel the contract within three days of receiving the package, and no reason needs to be given for that cancellation. If the buyer makes no objection during that three-day window, the purchase proceeds.
What does a disclosure packet contain? Any covenants, bylaws, financial disclosures, insurance information, special assessments, etc. The HOA will also conduct its own special inspection and evaluation to make sure it’s not in violation of any architectural guidelines and is in good shape. The HOA will also do a financial evaluation to make sure the current owners or sellers are up to date on all the dues and fees.
If there is a violation attached to that property, the seller will need to comply so they can receive a clean letter from the HOA before settlement stating that they’ve complied and everything can move forward. If the seller doesn’t come into compliance, the buyer takes on that risk. Most of the time, those violations remain and transfer to the new buyer.
There is also an expense for the package that’s usually incurred by the seller, and it can be paid at settlement in most cases. Most of us homeowners in the Northern Virginia area have lived in an HOA neighborhood at some point, so this is a standard part of the home buying process.
If you have any more questions about HOA resale disclosure packets or you’re thinking of buying or selling a home in our market, don’t hesitate to reach out to me. I’d love to help you.