ARAMCO Report - The Mother of ALL Mortgage Blogs!

HOA fees to impact credit scores

Posted by The Aramco Group on Wed, May 11, 2016 @ 14:05 PM

Homeowners associations, often referred to as HOAs, can be a helpful resource for community information, enforcing regulations and maintaining a neighborhood. And according to RealtorMag.org, Americans agree, with nearly twenty-five percent of owners selecting homes with HOA fees.

Unlike mortgage payments, insurance premiums and property taxes, missed HOA fees would not impact a homeowner's credit score. However, a recent announcement from credit data aggregator Sperlonga reveals that they intend to become the first company to furnish HOA payment status data to Equifax.

Homeowners association collect approximately $70 billion each year from 333,000 community associations nationwide. Homeowners who miss an HOA payment will begin seeing a negative impact on their credit beginning in October.

Equifax argues that the intention behind the move is not to ding those who miss payments but rather to give people an opportunity to build credit by tracking alternative data such as HOA fees, utility bills and rent payments.

Today, conventional conforming no-point 30-year fixed mortgage rates average 3.625 percent while the 15-year rate is near 2.875 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.