Update-Moving in Before Closing

I wrote a post about a friend of mine who moved into her new home before closing.  Here’s an update to the story. My friend had qualified for her loan and was very anxious to move from her ex’s house. She and the realtor decided that they would take a chance and have her move in.

She was very anxious and moved in-even cleaning the carpets, paying the movers and painting the place! Last week she heard from the bank; the loan had not been approved, there were problems with the HOA. The bank discovered that the HOA had several financial problems. The swimming pool has a crack in it and has not been open for 3 years!! She was devastated to say the least.

Not to beat a dead horse but this is exactly why you never want to move in before the close. Here’s another interesting phenomenon that is playing out in this rough economic climate-people are saving money by not paying their HOA fees. This really is a scary development. All the HOA can do is to put a lien against your property forcing you to pay it off before you can sell your property. However, in the meantime the dues go uncollected and all the deferred maintenance does not get done.

My friend is moving out this month to a rental while she regroups. I’m glad she is taking this step so as to avoid more problems-but what a mess.

Have you ever seen something like this? What would be your advice?

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