What Are Unpaid Home Owners’ Association DuesBefore you buy a land property in any subdivision here in the Philippines, make sure to check on the unpaid dues of the previous owner. Every month, homeowners need to pay a subdivision fee which is calculated depending on the amount per square meter. To know more about this, read until the end of this article so that you won’t have a problem in terms of unsettled fees when buying a lot.
Hidden Charge Explained The hidden charge that we are talking about here is the unpaid Home Owners’ Association dues by the lot owner. This subdivision due or HOA fee must be settled before buying a land property to avoid paying hefty hidden charges in the future. Making sure that the property doesn’t have any dues with the HOA admin will save you a lot of money and time by the time you want to build a house in that lot. Now, what is this Home Owners’ Association fee and why do homeowners need to pay it? This fee is used to maintain the subdivision’s amenities including the swimming pool, and it is also where the admin gets the salary for the security guards, utility workers, and even landscapers. HOA fees also help in paying common electricity consumption such as street lights. In other words, it is very important in the maintenance of the entire subdivision. The Problem with Unpaid Subdivision Dues It becomes a problem for the buyer of the land property when they only find out the unpaid dues after the lot title transfer. Why? Because it may be difficult to contact the previous owner after so many years without communication. If the seller have unsettled dues with the association, you might end up paying that amount. As a buyer, you won’t know this unless the seller discloses this part during the negotiation. You’re lucky if your real estate agent does his due diligence and ask the admin regarding this matter. Then it would be easy to avoid such problems and save yourself from the headache. Settling these unpaid dues before transferring the title is crucial when the time comes that you want to build a home. Remember that you will need a permit from HOA to build a house which you need to process by paying any amount due. Some sellers would say they won’t settle the dues anymore since the lot title has already been transferred to you. HOA Fees Computation Do you know why it is a big problem when you discover there are unpaid HOA dues from the previous owner? Let’s say you bought a lot in your dream subdivision and the HOA fee is Php 3 per square meter every month. That is Php 1,500 per month and Php 18,000 per year. If the previous owner did not settle this for 10 years, then you need to pay a whopping Php 180,000 HOA fees. So before you pay the total selling price of the lot you are buying, make sure that the owner has settled all dues with the HOA admin. Ask for the HOA Clearance or Official Receipt of the HOA fees paid for the previous year as proof of payment.
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