Have you ever heard of an estoppel letter? It’s a document that states the amounts to any statement of settlement for both the buyer and the seller of any real estate.
Estoppel is actually a judicial device in common law legal systems whereby a court may prevent or “estop” a person from making assertions or from going back on his/her word.
In real estate, estoppel letters are typically sent to the bank or lender of financing as well as any applicable condo/homeowner association and the local city/municipality clerk. They can also be sent to a resident who is requesting a mortgage payoff or for an assessment of all due taxes or amounts left due on a tenant’s lease. An estoppel letter is basically utilized in the transference of a real property. It’s used prior to closing proceedings.
Homeowners associations will often use estoppel letters as documented certification of a property owner’s monetary obligation to that association. The letter will indicate monthly or quarterly maintenance/association fees.
Lending organizations and/or banks who have applicants for a property under consideration for financing will want to see if there’s an estoppel letter from the homeowners association indicating if the property owner owes money to the association– and if so, how much?
Essentially, an estoppel letter informs a real estate buyer whether or not fees/charges against the property are current and outside a state of default. Remember, this is done prior to the closing of the sale. Buyers need to know if there are any outstanding charges– ones they don’t want to have to pay if they can get the seller to take care of them, right? Buyers also should know what kind of fees they’ll expect to pay when taking over a property that’s involved in a homeowners association situation.
Reliable Lien Search offers an HOA (homeowners association) estoppel search which includes association estoppel, master and/or sub association estoppel, attorney payoff(s), account history/lender supporting payoff, W-9 form for association(s), and a summary cover sheet highlighting results. Want convenient and hassle-free service with regards to estoppel letters? Reliable Lien Search can do the job! Call us today at 954-447-6947.