Unlike condominium assessments, homeowner’s association assessments are not valid against a purchaser or secured party unless a notice of the lien has been recorded.  Title commitments and title policies should contain an exception for any covenants, conditions and restrictions that created the homeowner’s association. Usually, those same covenants, conditions and restrictions will give the association the power to collect assessments.

The title commitment need not contain an exception for the assessments because they are not an automatic lien. Still if you have a commitment that has recorded covenants, conditions and restrictions for a homeowner’s association, it would be prudent to check the document to see if there are assessments. If there are assessments, order a payoff letter from the association. Questions? Please contact the ATG Underwriting Department, legal@atgf.com, 217-403-0020, or 312.752.1990.