Reviewing the resale certificate and HOA documents

Which form governs: condominium, common interest community, or HOA

Three sets of forms cover association property in Washington. A condominium is written on Form 28, the Condominium Purchase and Sale Agreement, and the association delivers a resale certificate: Form 27 for condominiums under the Washington Condominium Act (RCW 64.34), or Form 27CIC for communities under the Washington Uniform Common Interest Ownership Act (RCW 64.90), which covers communities created after July 1, 2018 and older ones that opted in. A house or townhome in a planned community that is a common interest community under RCW 64.90 is written on Form 21 with Form 22CIC attached, and the same 27CIC certificate is delivered.

A house in an older homeowners' association that is not a common interest community is written on Form 21 with paragraph 7 of Form 22D, the Optional Clauses Addendum, checked. There the seller provides a set of association documents rather than a statutory certificate.

Both certificate forms say on their first page that the certificate must be prepared by the association, its officer or authorized agent, and cannot be prepared by the real estate broker. That is why it takes time. The statute gives the association ten days from the request and caps the fee. Your contract shows which of the three situations you are in.

The review window, and what silence means

Your review clock starts on delivery of the certificate, not at mutual acceptance. Form 28 paragraph z says you are conclusively deemed to have approved the Resale Certificate unless, within 5 days following receipt, you give notice of disapproval; Form 22CIC paragraph 2(b) uses the same words. Five days is counted under Form 21 General Term l (business days, 9:00 p.m. cutoff). Timely disapproval terminates the agreement and refunds your earnest money; Form 90R is the notice. Silence approves.

The certificates also print a statutory right alongside the contract clock. Form 27 states the contract is voidable by the purchaser until the certificate has been provided and for five days thereafter, or until conveyance, whichever occurs first. Form 27CIC carries the RCW 64.90.640 version, keyed to five business days after first receiving the certificate. Those are statutory business days, not Form 21 days.

Under Form 22D paragraph 7, the seller has the days written (10 if blank) after mutual acceptance to deliver the association documents, and you have the days written (5 if blank) from receipt or from the date the documents were due, whichever comes first, to disapprove. Silence waives. If the seller delivers late, your window can be running before you have anything to read; tell your agent the day a due date passes.

What the resale certificate tells you

The resale certificate is a numbered questionnaire the association answers about your unit and the association as a whole. Read every line; the certificate is where the money is. Both forms print a buyer protection: you are not liable for unpaid assessments or fees against the unit greater than the amount the certificate states, unless you knew otherwise. That is why the figures on it must be right. The items include:

• The current monthly assessment, past-due amounts against the unit, and any special assessments levied, how much remains unpaid and what they are for.
• Delinquent assessments across the association and bills the association itself is behind on, as of a date within the last 45 days. Widespread delinquency is a cash-flow warning.
• Fees beyond dues: move-in and move-out fees, parking, storage, and use of common facilities.
• Anticipated repair or replacement costs exceeding 5% of the annual budget, and the reserves on hand. Form 27 warns that without a reserve study, insufficient reserves may mean a special assessment on demand.
• Pending lawsuits and judgments, alterations to the unit the association knows of, and health or building code violations.
• Leasehold status, the master insurance policy and what it covers for unit owners, warranty claims, and the limited common elements assigned to the unit (a parking stall, a deck).

Reading the documents: declaration, bylaws, rules, budget, reserves, minutes

Form 27 requires these exhibits: the declaration and amendments with recording numbers, the bylaws, the rules and regulations, the prior year's annual financial statement, a balance sheet and revenue and expense statement current to within 120 days, the current operating budget, and the current reserve study or a statement that none exists. Form 22D paragraph 7 lists the rules, the bylaws and CC&Rs, two years of association meeting minutes, six months of board minutes, and two years of financial statements plus the current budget. On a condominium, if minutes are not among the exhibits, ask for them through your agent.

Read in this order. The declaration (CC&Rs) is the constitution: use restrictions, rental caps and minimum lease terms, pet limits, parking, what the association maintains versus what you maintain, and how assessments are levied. The rules and architectural guidelines are the day-to-day version. The budget tells you whether dues cover expenses; the reserve study tells you whether the association is saving for the roof, siding and elevators or planning to bill owners when they fail. The minutes tell you what the board is actually worried about: leaks, litigation, a special assessment under discussion. Read the master insurance summary for the deductible; unit owners commonly carry their own HO-6 policy to cover it.

Dues, special assessments, transfer fees, and how objections work

Dues are the monthly or quarterly assessment the budget allocates to your unit. On a condominium they commonly fund the master insurance policy, common-area maintenance, often water, sewer and garbage, elevators, management and the reserve contribution. In a planned community of houses they typically fund common areas, private roads and entry features. Form 21 General Term h prorates lienable association dues as of closing, so you pay from closing forward. A special assessment already levied but not yet paid is a contract question: how it is split is a term your agent negotiates, and the time to raise it is inside your window.

Transfer, move-in and move-out fees follow Form 22D paragraph 8: paid by the party the association documents name; if the documents are silent, by the party checked on the form, the seller if neither box is checked. The certificate lists these fees.

Objections on these forms are approve-or-terminate. There is no repair or negotiation mechanic: your unilateral protection is a written disapproval delivered before the window ends, which terminates the contract with your earnest money returned. If something concerns you but you want the home, your agent can propose a change by addendum while the window is open. Without written agreement by the deadline, the choice is yours: terminate on time, or proceed.