Section 6(d) Certificates
Condominium fees and special assessments that are not paid threaten the financial wellbeing of a condominium, which relies on the contributions of unit owners to pay for upkeep of the common areas and other shared expenses. If there is a high delinquency rate among unit owners, this can detrimentally affect the sale of the units because it runs afoul of the lending guidelines for condominiums. The Massachusetts Condominium Act, General Laws, Chapter 183A gives condominium trustees and managers a means by which to recover unpaid fees and special assessments. Securing a clean Section 6(d) certificate is a critical part of a condominium purchase in Boston. The real estate attorneys at Pulgini & Norton can advise you on this process.What is a Section 6(d) Certificate?
Unfortunately, the problem of unpaid fees is pervasive in Massachusetts. Under Massachusetts General Laws Chapter 183A, condominium associations may file a lien for unpaid fees against a delinquent owner. Specifically, the monthly fees create a lien against a unit from the date they come due, and owners may be held personally accountable for their shares of these expenses. The association's lien cannot be discharged through the unit owner's bankruptcy.
The first six months of unpaid fees take priority over the lender's first mortgage. Sometimes the lender pays the fees for the unit owner in order to avoid the effects of the super lien and then adds the paid amount to the mortgage. If the arrearage is not paid, a condominium trust can foreclose and sell a unit at auction.
Under Massachusetts General Laws Chapter 183A, section 6(d), condominium trustees must sign a certificate that verifies the outstanding condominium fees that are assessed against the unit, if there are any. This is called a "6(d)" certificate. It can take several weeks to get this document signed. The certificate must be signed in the presence of a notary by the number of trustees specified in the establishing documents of the condominium.
Lenders require that buyers obtain a clean 6(d) certificate at closing. Without this certificate, they may not loan a buyer the money to buy the unit. A clean certificate certifies the seller doesn't have any unpaid condo fees that a buyer or her lender would be responsible for. If a clean 6(d) certificate is signed and recorded, an association may not file a lien against the unit.
Purchasers of condominiums may not understand what the certificate is, or how it protects them. However, without this certificate, a buyer would not have clean title. He or she would be responsible for the unpaid fees because the association needs the monthly funds to operate. The certificate also protects the lender because it insures that the association is going to remain financially solvent and the property retains value and will continue to be maintained.Consult a Boston Attorney to Protect Your Rights as a Condominium Owner
You should seek the guidance of an experienced Boston lawyer if you are considering a condominium conversion, purchase, or sale. Among other things, we can help you get your Section 6(d) certificate and make sure that your purchase of a home—possibly the most important transaction you will ever make—goes smoothly. We represent clients in Lowell, Brookline, and Medford, among other communities throughout Massachusetts. Call us at 781-843-2200 or contact us via our online form for a consultation.