Josiah is saying, what is your process to definitively figure out if there is an HOA?
It is not always obvious to me, whether an HOA exists.
I just flipped a property where the only reason I knew there was an HOA was because a neighbor told me.
The owner didn't even know, or at least claimed not to know.
I reviewed all the deeds I could pull up on the property appraiser and county recorder website
and there was nothing within the previous deeds that would indicate there was an HOA.
Once you figure that out and assuming you're trying to self-close a deal,
do you ever run into trouble finding out what HOA back dues are owed on a property?
Yeah. So, that is a frustrating thing.
And I think part of the problem, because sometimes an HOA can exist between like two houses.
Maybe they share a driveway and it's like, well, let's set up an HOA and we'll pay into this thing.
So it's like super unofficial.
There is no public record of it.
And there's not even like a phone number to call, the way they keep track of billing is
just on some spreadsheet somewhere.
So, yeah, there are totally times when you'll just never know.
And there is no way to tell, I think probably like at least 80% of the time there's going
to be something in the title history.
And the issue that you might be running into is it could be that the HOA was formed
further back than your title search went.
Like maybe it was formed 50 years ago or something.
And your title search is for 40 years, or maybe you just pulled the last few deeds and it wasn't there.
And whenever you do a title search, it's important to get like a full abstract of title.
Like not just the past deed, that's not enough information.
You've got to find out everything that was recorded along with this parcel number and legal description.
And also it has a lot to do with how well manage the HOA is
A huge HOA will have like its own board and its own office,
or maybe there's some like third-party company that manages it.
There is a number you can call to find out, and it's going to be very obvious all over
the place that there's an HOA, but in terms of a bulletproof way to always know there isn't one,
because there is no federally mandated way that all HOAs have to report.
I totally agree. It's super frustrating.
And I've encountered it too.
And sometimes like an HOA will exist, but it's like defunct.
Like the whole thing is bankrupt.
Like there is no money in, nobody's doing anything, nobody's assigned to take care of it.
It may sort of exist in the title history, but nobody's going to come knocking
if you don't pay your bills and that's another layer of complexity and frustration about it,
but in terms of like different ways to probe and figure out like, what is the situation?
I mean, one way would be kind of just looking at a satellite map.
Sometimes you can see like, is this a well-laid-out subdivision?
Does it kind of look like it's self contained thing apart from the rest of the city or the area?
Sometimes that can be a clue in terms of like calling it neighbors and stuff.
If you can find their phone numbers it seems like kind of not reliable way to do that,
but yeah, I mean, talking to the owner, most owners, I would think
there's not like a huge reason to lie about that.
I mean, maybe if it's like a horrible HOA or if there's tons of money owed or something like that
but most people like I would just sort of take their word at it.
And if somebody doesn't even know there's an HOA and if that's true, I mean, that would
sort of tell me that this HOA must be really poorly managed if this person doesn't even know
like if they haven't ever gotten bills or calls when they haven't paid dues and that kind of thing.
And I know DataTree does have a filter that works in about, I think, half the country.
So if it does work in that county, there's a filter where you can identify whether
it's part of an HOA, but again, it's not totally reliable everywhere.
So I guess it's not that help.
I would just mention that sometimes in these office hours, you answer a question
and it's pure gold content.
And like, if you were to just take that clip of you answering that question
and put it on like a YouTube short or something or Instagram or whatever,
or if we had like a running docket, that was definitely one of them.
I mean, I don't know if you've ever written a blog article, but even if you were to
just transcribe what you just said, it was beautiful.
Sometimes you answer these really well.
This was not one of those times.
That would be absolutely horrible if I did that.
No, I just thought that was really good.
Cause it's true.
I didn't know that you could establish an HOA between two neighbors and all that stuff.
Like that's gold.
That's the insightful information.
It's really anytime there's a private something that the city is not paying for,
but more than one house wants to chip in together to cover something like sewers or water.
There was a bridge at a house that I grew up in, in California
and the maintenance was shared by the neighbors.
The only thing that I would say is I'm kind of a broken record.
This is one of the many reasons why I was going through a title company.
Cause I know that certain deals and it depends on if you do a lot of term stuff, like I get it.
But for me, when you got title insurance, if there's ever an issue with back HOA fees,
you're going to be absolutely fine.
But if not, and you miss something, that's the risk that you take.
I had talked with my title company about this a few years ago, like this specific question about HOS
what is the bulletproof way to know?
And that was his answer to me is like, there is no way, because there's no federally mandated way to do it.
Like you can usually find clues, but there's not like one authoritative source
that will always tell you truth.
Just have to find what you can.
It's another one of those things where like, it feels like it's a broken system.
The fact that you can not really know the answer.
It's like, why not?
Like why doesn't somebody figure out a way to make everybody report?
They should.
I think that they should have a uniform closing process state across all states
because they just make life so much easier.