By the way, I'm can only think of ONE case where it was not paid EVER. The lenders never have a problem with it.
Here is a bold question, DID YOU FORGET TO INCLUDE IT ON THE ORIGINAL ESTIMATE SENT TO THE LENDER?
I've only had GMAC refuse to pay "non-late" HOA fees. So, if it is May and we estimate costs to close in August, and I put, "1,200 HOA fees from 05/01/11 - 08/15/01", they would refuse to pay. If you need to estimate out a few months, you do it as "past due". For instance, instead of putting what I did above, you put 01/01/2011 - 04/01/2011. The lender considers this "past due" and will pay it. Otherwise, they still consider the HOA fees that are not late and are "estimated" to be the seller's responsibility and will refuse it.
I always tell our HOA owners...if you have to stop paying the mortgage, you have to stop paying the mortgage...but please, please, please keep current on the HOAs whenever possible.
The best way is to have the seller issue a statement they waive the seller incentive. On the HUD statement on the HOA lines put paid from Seller's Incentive. That will work for part of it. The next best step is to contact the HOA and negotiate the lien to be reduced (hopefully just the amt. of the incentive) if any is left then you can see if the buyer or seller can cover the difference. Sometimes depending on the bank they will pay up to a portion of the past due amounts.