Delinquent HOA assessments typically stop reverse mortgage eligibility until they are paid or released. Jay Zayer, CRMP, is a reverse mortgage specialist at reversemortgage.coach. A first-lien HECM still needs insurable title under 24 CFR 206.35. Unpaid association dues can become a recorded lien. 24 CFR 206.205 still leaves HOA charges on you after closing. A LESA holds estimated taxes and hazard. It does not pay the association.
Take a Scottsdale homeowner named Ivo, 72, whose HOA recorded after two missed quarters. Occupancy is true. Age is true. None of that clears Schedule B. The file waits on a payoff, a release, or a payment plan title will accept.
A HECM remains FHA-insured. HOA arrears are not a government dues-forgiveness program.
Does unpaid HOA by itself deny a HECM until the ledger is current?
A recorded association lien denies a first-lien close until it is cleared. An unrecorded ledger balance is still a residual-income and property-charge history item under Mortgagee Letters 2014-21 and 2014-22. The prelim decides which you have. Do not hide the statement and hope.
This page is delinquent dues. HOA lien is the recorded association claim in more depth. HOA litigation is a lawsuit that can freeze a condo project. Stay here when the live fact is unpaid assessments on a house Ivo occupies.
Ivo’s leftover cash after the demand still tracks the mid-30s to low-50s of value after age and expected rate. I will not quote a live cell. Run the calculator with the HOA payoff, not without it.
When can seasoning stop me from paying the HOA with HECM proceeds?
24 CFR 206.36 can block paying an unseasoned non-HECM association lien from proceeds when leftover cash to Ivo would exceed $500. A dues lien older than twelve months, or a structure with $500 or less cash out, is the statutory fork. A last-week recording plus a large leftover draw is the pattern that rule is built to catch. Pay from other funds, wait, or accept the $500 structure. A slogan is not.
Mortgagee Letter 2017-12 still charges 2.00% initial MIP of claim amount after the dues are cleared. Annual MIP is 0.50% of outstanding balance. 2026 files still use the $1,249,125 cap in Mortgagee Letter 2025-22. Origination is still capped at $6,000 under 24 CFR 206.31. An HOA fight does not discount MIP.
If residual income requires a LESA, that set-aside is still origination-only. A LESA does not pay Ivo’s association. Residual income has to carry ongoing dues after closing. 24 CFR 206.27 can still treat unpaid property charges as a default path.
Counseling still costs $125–$175. The HUD certificate lasts 180 days. Arizona Scottsdale has no California Civil Code 1923.2(k) seven-day pause. Do not start the 180-day clock while the lien is unreleased.
How do super-priority HOA statutes change the HECM conversation?
Some states let a slice of unpaid assessments jump other liens. That can change payoff order and title appetite. I will not invent a live dollar cap as HUD law. Confirm the statute and the association demand with title. A California condo and a Scottsdale planned-unit development do not share the same state statute. HUD’s first-lien requirement does not change.
A second geography: a 69-year-old in Riverside whose California HOA recorded last month. Same 24 CFR 206.35 test. Civil Code 1923.2(k) still adds seven days after counseling there. The dues still have to be current or paid at the table.
An adjustable HECM after Ivo’s association demand is paid still accrues at 1-month CMT plus lender margin. Expected rate still rounds to 0.125% under 24 CFR 206.3. Jay still quotes about 30 days on a complete refinance after the association demand is paid, not while the manager will not quote.
Heirs who later keep Ivo’s house repay the outstanding loan balance under 24 CFR 206.125(a)(2)(i). A paid HOA ledger does not rewrite that subsection.
Who should not let an HOA delinquency sit through counseling?
This path does not help a household that wants me to close and “catch up the dues later.” I will not. Occupancy is still 24 CFR 206.39. I work with multiple lenders. I will originate after the association is current or validly paid at closing. I will turn away a recorded dues claim whose owner wanted the line this month.
Do ongoing HOA dues ride in a LESA after Ivo catches up?
No. 24 CFR 206.205 still leaves association charges on the borrower. A LESA holds estimated taxes and hazard. Residual income has to carry the dues after closing. Riverside California files add Civil Code 1923.2(k). Scottsdale files do not. HUD’s first-lien test does not change. Super-priority slices, if any, still belong on the title demand, not in a kitchen-table guess.
I will not originate while the manager will not quote. Counseling money does not quiet an association lien. A current ledger is the exhibit. A manager’s voicemail is not.