Sell a Condo or Townhome: Resale Certificates, Assessment Liens, and Why Financed Buyers Fall Through

Condominium, Townhome, or POA? The Label Decides Which Law Applies

Which statute governs your sale turns on a label that is easy to get wrong. A true condominium — interior airspace plus an undivided interest in the common elements — is created by a declaration recorded with the Dallas County Clerk's Recording Division at 500 Elm Street. Chapter 82, the Uniform Condominium Act, applies to a condominium "for which the declaration is recorded on or after January 1, 1994"; an older regime is generally governed by Chapter 81 unless the owners voted to come fully under Chapter 82.

A townhome is usually a different animal. If you own the structure and the ground beneath it and a homeowners' association governs the subdivision rather than a condominium regime, you are a member of a property owners' association under Chapter 209, the Texas Residential Property Owners Protection Act — not a condominium owner at all. The resale-certificate deadline, the fee cap and the section number you would cite are all different.

The Resale Certificate a Condo Association Has to Produce

If your unit is a true condominium under Chapter 82, §82.157 requires the association to furnish a resale certificate to the selling unit owner or the owner's agent within 10 days of a written request, signed and dated by an officer or authorized agent. It sets no dollar cap on the fee — the $375 figure people quote comes from the separate property-owners'-association rule below — so ask for the schedule in the same written request.

What §82.157 does give you is cover. Miss the 10-day deadline and the unit owner may hand the purchaser a sworn affidavit instead, and "a selling unit owner or the owner's agent is not liable to the purchaser for erroneous information provided by the association in the certificate." Under §82.157(c) the purchaser is not liable for delinquencies above the total the certificate stated, and under §82.157(e) a purchaser, lender or title insurer relying on it is not liable for an undisclosed debt. §82.002(c) carries §82.157 back to pre-1994 condominiums — but the clock starts only once the request is in writing.

A Townhome Under a POA Uses a Different Certificate — Chapter 209

For a townhome inside a subdivision-style property owners' association, Chapter 209 applies instead of Chapter 82, and the statute draws the line itself: §209.003(d) states that "this chapter does not apply to a condominium as defined by Section 81.002 or 82.003." Chapter 209 reaches a residential subdivision whose declaration lets the association levy assessments on all or a majority of the property and requires mandatory membership, whatever the association calls itself.

The certificate runs under §207.003: due by the 10th business day after a written request for subdivision information, prepared no earlier than the 60th day before delivery, a fee to assemble, copy and deliver it that may "not exceed $375," and an update — due by the 7th business day — that may "not exceed $75." Those figures come from S.B. 1588, effective September 1, 2021. Asking a condominium association for a "Chapter 209 resale certificate," or the reverse, adds a week to the request.

Assessment Liens: How an Unpaid Balance Attaches to the Unit

Under §82.113 an assessment the association levies is a personal obligation of the unit owner and is also secured by a continuing lien on the unit, plus any rents and insurance proceeds tied to it. "Assessments" is defined broadly — regular and special assessments, dues, fees, fines, interest, late charges, collection costs and attorney's fees all enforce the same way.

The lien carries real priority. By statute it takes precedence over other liens on the unit, with four exceptions: a real property tax lien; a lien recorded before the declaration; a first vendor's or first deed-of-trust lien recorded before the assessment went delinquent; and, unless the declaration says otherwise, a construction lien or assigned insurance proceeds recorded before the delinquency date. A mortgage that predates the delinquency therefore still outranks the association — but a past-due balance does jump ahead of unsecured debt and later-recorded liens, which is why it surfaces as a title problem like any judgment or mechanic's lien.

Special Assessments and the Declaration's Transfer Rules Add Timing Risk

Beyond routine dues, the declaration itself can slow a sale in ways the statute never touches. A special assessment — a one-time charge for a roof, a foundation problem or a lawsuit settlement — can land mid-transaction and change the numbers at the closing table. Many declarations also carry a right-of-first-refusal clause, letting the association or its members match an outside offer before it closes, or a transfer-fee provision charging a fee simply for the deed to change hands. Neither is statutory; both live in the declaration recorded against your unit. Read it before you sign a contract with a financed buyer's closing date already locked in.

The Seller's Disclosure Notice Still Applies

A condo or townhome doesn't get a pass on Texas's standard disclosure law. Texas Property Code §5.008 requires the seller of "residential real property comprising not more than one dwelling unit" to give the buyer the statutory Seller's Disclosure Notice (or an equivalent that covers the same items at minimum) — and a single condominium or townhome unit is exactly the kind of one-dwelling-unit property the statute is written for. The disclosure obligation runs alongside, not instead of, the association's resale certificate; a buyer's closing file typically needs both.

Why a Financed Buyer Falls Through and a Cash Buyer Doesn't

Even a spotless unit with a clean resale certificate can lose a financed buyer over something outside your control: whether the project is warrantable. HUD Handbook 4000.1 Section II.C sets FHA's condominium project approval standard — the whole project clears review on insurance, financial condition, pending litigation and other marketability factors, not just your unit. Where the project is not FHA-approved a buyer may still qualify for Single-Unit Approval, but the project must first clear its own eligibility list (4000.1 II.A.8.p.iii(C)): certificates of occupancy for the completed project or legal phase, a CO for the subject unit issued at least a year ago or prior occupancy, "at least five Units," no manufactured home, no ineligible characteristics, and free assumability under 24 CFR §203.41. A separate ceiling sits on top: FHA may suspend new case numbers once FHA-insured mortgages exceed 10 percent of the units in a project of 20 or more, and cannot exceed two in a project under 20 units.

None of that is about your unit's condition. Too many renters, thin reserves or an active lawsuit against the HOA can make a project functionally unsellable to an FHA or conventional buyer — precisely the gap a cash buyer fills, because a cash purchase never runs through project-approval underwriting.

Selling As-Is While the Paperwork Sorts Itself Out

A cash, as-is sale does not erase the resale-certificate request, an existing assessment lien or a declaration's transfer clause — those still resolve at or before closing. What it removes is what these sales actually lose time to: a lender's project-approval review, an appraisal contingency tied to a warrantability finding, and a buyer walking after underwriting flags the HOA's litigation or reserves. We buy condos and townhomes directly from owners across the county, on a timeline that does not depend on the association or a bank — the same team covers the surrounding suburbs too. If you are weighing a sale on a detached property instead, or selling during a divorce with the condo as a shared asset, call (323) 622-6021 for a no-obligation cash offer and a closing in as little as 7 days.

Related Situations

Dealing with a different situation? See our guide to selling a duplex or small multifamily or selling a mobile or manufactured home.