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HOA Addendum

July 19, 2017 - By Rachel Deckman

If you are buying or selling within a Home Owners Association (HOA) or Planned Community, an HOA Addendum will be a necessary form that both buyer and seller will have to fill out. Read below for everything you need to know about the HOA Addendum. 

The HOA Addendum was created because many buyers in the Arizona were not aware of all the HOA fees that are a cost to home owners until after purchasing their home. The HOA Addendum to the purchase contract ensures that the seller is telling the buyer exactly how much the fees are in writing prior to the purchase. It will be initiated by the seller at the time of listing their home. The homeowner will be responsible to provide information on the HOA and the fees payable upon close of escrow at that time. The main purpose of this disclosure is to avoid any last minute surprises at closing that may place the transaction in jeopardy.


Section One- Page One
The first section in the HOA Addendum is the Seller’s Notice. This is where the Seller has to put in writing who governs the HOA community, their contact information and how much the fees will be monthly. If there is a Master Association in addition to the HOA, they must also enclose that information. A master association is common in master planned communities that have multiple subdivisions within their cohesive community plan.


Section Two- Page One

The second section is the Fee’s Payable. In this section of the HOA Addendum, all fees that are to be paid upon closing are listed and their costs. The seller is to fill out this information on their own and a quick call to the association or association’s property manager can quickly get you these dollar fugures. Laying out exactly who pays the transfer fees (either the buyer or the seller) comes later in the document.

Section Three- Page Two 

The legal obligations required by the seller and buyer are disclosed on the second page of the document. This includes information about when the HOA should be notified upon contract acceptance of the property and any other information that is to be provided to the buyer by the seller of the HOA community. This includes items such as a copy of the bylaws and the rules of the association, a copy of the declaration of Covenants, Conditions and Restrictions (“CC&Rs”) and a stated document requiring a list of information among other copies of HOA budgets and financial reports. It is important that the buyer and seller read over what is required of them on page two to ensure they are not missing any important legal obligations that is required of them.


Section Four- Page Three: Who pays the transfer fees? 

Under the Buyer Acknowledgement and Terms, the buyer reads over what the seller has provided and lays out how the closing fees should be paid.

The closing fees can be paid by the buyer or the seller. There is a third option of “Other” on the form. This is often where the buyer and seller can agree to split the costs. To prevent any major surprises on who pays the fees, your agent will assist in working out negotiations in the original purchase contract agreement with the seller.


Any additional conditions that they buyer would like to include can be added under the additional terms and conditions. The seller then accepts the terms and signs off on the HOA Addendum at the bottom of the page.

The HOA Addendum is used as a way to inform and disclose to the buyer exactly what they will be paying in regards to HOA fees as well as which party will be responsible for fees to be paid at closing. Should you have any questions regarding the HOA Addendum, be sure to reach out to your agent. We will be more than happy to assist with any questions you may have!