Let’s Work Together, Real Estate Agents and Association Managers

Association managers and real estate agents interact on a near-daily basis. Each one has their functions to perform.

Many times, real estate agents feel they are hitting brick walls when dealing with homeowner associations. They don’t understand why their requests for documents and buyer approvals simply can’t be turned over quickly.

Managers, on the other hand, may ignore some of the agents’ requests because they are being “pushy” or have no right to some of the information.

How Can Real Estate Agents and Association Managers Help Each Other?

I have been a licensed real estate broker in Florida for about twenty years. I have been in the association management business for sixteen of those years.

I understand that real estate agents have a job to perform. Their pay depends on that performance. If the tasks are completed, they get their commission and have a happy transaction. What real estate agents should understand as well is the manager’s duty to the owners of the association. Managers are not obligated to divulge much of the information sought.

Having experience on both sides of these industries, I often refer the agent to make sure their buyers read the documents. An email from management that quotes an association rule and is wrongly interpreted can be used as evidence if the transaction goes south later.

I’m a bit of a stickler and tend to treat most of my work as having the potential for legal review. Emails are official records and can be used in court.

Managers should not be interpreting the documents or rules of the association. That is an attorney’s duty and should be referred to such a professional. Real estate agents should refer their buyers to real estate attorneys if they are unclear about the precise meaning of an association’s rule. The lending agents often place real estate agents and managers in difficult positions with demands of interpretation.

Buyers Approvals

Real estate agents, the association is not obligated to “rush” the approval process because a quick closing has been agreed to by the parties of the real estate transaction.

Most associations have 30 days to approve a buyer. Most approvals can easily be approved within two weeks, but please don’t rush management. When a rush is necessary for approval, the first and foremost concern should be that the buyer completes the application properly. Nothing will move forward in the buyer approval process if the application is incomplete or the application payment has not been made.

I prefer to use services such as tenantevaluation.com for approval processing. These online services provide an easy process and turn out legible applications that can be saved, printed, and forwarded as needed for a seamless and streamlined approval process.

So, I go with, “Help us in helping you.” As an agent, if you do your part to ensure the application is complete and payment is made, we can help you acquire the approval faster. However, remember that management does not “approve” anything. The review and approval process are for the Board. Most boards act quickly, but some do take their time. If something stands out in the application, the board may take additional time to finalize the approval.

Documents and Disclosures

Please understand that being the listing agent does not transfer ownership rights to you. The listing agent does not automatically have the right to request documents, budgets, balance sheets, minutes, etc.

Simply listing a property for one owner does not remove the right of privacy for all other owners in that building or association. Management has a duty to all owners and the board.

Financial records and other documents are not for public dissemination. Who does have the right to those documents upon demand? The seller. Members of homeowners’ associations (the sellers) have the right to review and copy the association’s documents, also known as the “official records,” after a written request. This is the simplest way to get the documents you seek quickly.

The best recommendation I can give you to facilitate the transaction and provide the buyers and lender with the necessary reading materials is to have the seller agree to provide those documents. It may even be a consideration to place it in the real estate contract as an addendum. I would go further than just the usual documents. I would provide the buyers with a complete file set showing different facets of the property. Here are some that would be helpful:

Articles of Incorporation
CC&R’s
ByLaws
Rules and Regulations
Minutes for the previous 12 months
Reserve Study
Appraisal
Insurance Summary of Policies
Structural Inspections Reports
Life Safety / Fire Inspections of Fire Alarm and Sprinklers
Special Assessment details (cover letter sent)
Budgets for the last three years
Annual Audit for three years (some associations may not have audits performed)
Previous years’ year financial statement (income and expense)
Elevator Inspection (the latest one is sufficient)
Buyers Application
Milestone Inspections

A simple email request from a seller to the manager can provide almost every document listed above. If you’re the listing agent, your client should make this request at the time of the listing agreement. Provide these documents to buyers when the seller’s disclosure is provided or you have an executed contract.

We all have our duties to perform. We all generally have very busy work lives in these two industries. Once we understand each other’s position in real estate transactions, all parties can act accordingly and provide the buyers and sellers with the outcome they seek: the home transfer.

Please check out my blog for many other homeowner and condo association articles.

Karel Costa-Armas, CMCA, AMS, PCAM