Q: There is an initial cap fee in the resale certificate. Please explain what this is?
Who pays the initial cap fee? Is there a maximum amount of cap fee that can be charged? Why is a cap fee being charged?
A: The law caps the charges that may be imposed by a Condo or Homeowners Association for a resale certificate at $250. Any increase in this amount will be tied to the Consumer Price Index and may not occur more frequently than every two years. A unit inspection fee of $100 and a rush fee of $50 to $100 may be charged by the Association in addition to the $250 base fee. The "initial" cap fee likely refers to the fee originally set by the Association for the issuance of a resale certificate, prior to any increases allowed under the law. The amount is charged when a home in an HOA is sold, with the fee going to the HOA. A resale certificate gives specific information about the property that is being sold and where it stands with the HOA; this incudes disclosing any past-due payments or unpaid violations, any pending violations, and all fees that are due upon closing.
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