Texas HOA Resale Certificate

What this letter does

A Texas HOA resale certificate request asks the property owners' association to deliver the subdivision information and resale certificate that Texas Property Code section 207.003 requires on a sale. The certificate reports the status of assessments and other facts a buyer needs before closing.

Key rules in section 207.003

• What must be delivered. The association must deliver the current restrictions, the current bylaws and rules, and a resale certificate.
• 10th business day. It must deliver these on or before the 10th business day after receiving a written request and verifying the requestor's authority.
• Certificate age. The certificate must be prepared not earlier than the 60th day before the date it is delivered.
• Contents. The statute lists sixteen items, including transfer restraints and any right of first refusal, regular assessment frequency and amount, approved special assessments due after delivery, total unpaid amounts attributable to the property, reserves, operating budget and balance sheet, unsatisfied judgments and pending lawsuits, insurance certificate, known violations and governmental notices, and transfer fees.
• Fee caps. Not to exceed $375 for assembling, copying and delivering the information, and not to exceed $75 for preparing an update. The association may require payment up front but may not process it until the certificate is available, and no fee may be charged if the certificate is not delivered on time.
• Updates. An updated certificate must be delivered by the seventh business day after a written update request, if requested within 180 days after the original certificate.
• Delivery details. A request that does not specify the recipient's name and location is not effective.
• Proof of authority. The association may require reasonable proof that a purchaser has a right to acquire the property.

If the association is late (section 207.004)

If the association does not deliver the information on time, the owner, the owner's agent, or a title company acting for the owner may submit a second request. If the association still has not delivered before the fifth business day after the second request was mailed by certified mail, return receipt requested, or hand delivered with a receipt, the owner may seek any combination of: a court order directing delivery; a judgment against the association for not more than $5,000; a judgment for court costs and reasonable attorney's fees; and a judgment allowing the owner to deduct those awards from future assessments. The owner may also give a buyer under contract an affidavit stating that two written requests were made and the association did not timely provide the information. If the owner does so, the buyer, lender and title insurer are not liable to the association for money due and unpaid or debts that accrued before the date of the affidavit, and the association's lien for the amounts due on that date automatically terminates.

Effect of the certificate (section 207.005)

The association may not deny the validity of any statement in the resale certificate. Its lien for undisclosed amounts due on the preparation date automatically terminates as a lien securing the undisclosed amount, and buyers, owners, lenders and title insurers are not liable for debts existing on the preparation date that were not disclosed. The certificate does not affect the association's right to recover debts that arise after its date, or the lien securing future assessments. Except as provided by section 207.004, the association is not liable to the selling owner for delay, and officers and agents are not liable for a delay or failure to furnish a certificate.

Scope and online information

Chapter 207 applies to a subdivision with a property owners' association entitled to levy regular or special assessments. It does not apply to condominium councils of owners under Chapter 81 or condominium unit owners' associations under Chapter 82. Under section 207.006, an association of a subdivision with at least 60 lots, or one that has contracted with a management company, must make its current dedicatory instruments filed in the county deed records available on a website available to members.

Fee caps and rules can change, so check the current text.

How to use the letter

1. Name the recipient and delivery method in the request.
2. Attach proof of authority, such as the contract.
3. Send it in a way you can prove, and note the date.
4. Request an update if closing slips.

See also the closing, estoppel and paid assessment comparison and the Texas records request.

A seller who also needs a lien-free confirmation can use the HOA lien release letter, and the HOA estoppel letter covers the general form.

Common questions

How long does a Texas HOA have to deliver a resale certificate?

By the 10th business day after receiving the request and verifying authority.

What if the HOA does not deliver on time?

The owner can send a second request, and if it is not met before the fifth business day, may seek a court order, up to $5,000, costs and attorney's fees, and give the buyer an affidavit that terminates the association's lien for the amounts due on that date, under section 207.004.

How much can a Texas HOA charge?

Up to $375 for the information and $75 for an update, under section 207.003, subject to current law.

This page gives general information and sample wording. It is not legal advice, and requirements differ by state and by association.