Does and HOA have to disclosure prior to trustee sale?
Hi, new to BP and love what I'm seeing so far! I'm an AZ-licensed RE agent and have a question that nobody seems to have an answer for (except possibly an attorney).
Situation: Auction.com is having an upcoming foreclosure/trustee sale. In the prelim title report, the recorded Notice of Trustee Sale was dated in 2015. The HOA's Notice of Claim of Lien is dated 2019 so the foreclosure is not the result of unpaid HOA assessments, but lien priority will definitely protect the HOA to clear the title. Auction.com says the winner will receive a "Foreclosure Deed" at close and its "up to the buyer" to clear the title.
Concern: In the HOA Lien document, a clause states "the said assessment due for the property is of a continuing nature and the stated as due and owing in the lean will increase and will continue to increase and accrue, plus interest charges, approved by the HOA board of directors, if non-payment continues".
I'm aware there are maximum lawyer's fees, collection fees, interest, etc that can be charged to the buyer per AZ laws but I haven't read anywhere that there's a maximum HOA assessment delinquency that can be charged. Because so much time has lapsed since the HOA lien was filed, (with a fairly large delinquent amount to start with) the final number owed to the HOA (likely by my buyer) at closing could be huge.
I've tried everything on my own to find out what the current delinquency amount is in order to make an informed bidding decision. The HOA company says they can't disclose the amount and sent me to their attorney, who says they don't know and sent me to the collections company, who says to call the HOA company. I'm aware that under normal circumstances, the HOA has to disclose all things that can affect title to the property but all bets seem to be off for a prospective buyer in a foreclosure sale.
My question: Does the HOA have to, by law, disclose to the buyer the current delinquency prior to close, even though its a foreclosure sale? Do I HAVE to involve a lawyer to force them disclose?
Most HOA lawyers I spoke with quoted $500 just to sit and talk about it for 30 minutes. I'd hate to find out that I could've just taken legal action against the HOA to disclose without involving a lawyer. I'd also hate to find out that I missed an online article somewhere saying the law states the HOA doesn't have to disclose the amount when it's a foreclosure auction. Call me cheap, but if the amount owed the HOA is astronomical, we're not bidding anyway. Hoping someone here has run into a similar situation and can advise.
Thanks for reading this long post!
-John in Phx, AZ