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What Do You Need to Know Before Joining or Running an HOA?

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Whether you’re buying into an HOA or looking to become a board member, you should be aware of the HOA rules and regulations specific to your property. These guidelines determine how different HOAs function, as well as whether they are a good fit for certain residents more than others.

HOAs may not be suited for everyone. It’s critical to do your research before you buy into one, because if you violate the regulations, it can end up costing you a great deal of money in fines and other expenses. Let’s go over the most important things you need to know about HOAs.

Common HOA Terms

Before you begin living in an HOA community, make sure to do adequate research to ensure you understand what you’re buying into. Due to the various restrictions, regulations, and expenses, some people will not be happy being part of an HOA, while others will feel right at home. Which are you? You won’t know until you do your research.

One of the first things to learn is the industry jargon. It’s important to be familiar with the terms you’ll likely see when dealing with paperwork and contracts. Here are a handful of terms our HOA professionals believe you need to be aware of:

GOVERNING DOCUMENTS

Every HOA has different bylaws that determine the rules and regulations for the organization. While most bylaws include similar concepts and rules, each one is unique to the organization at hand. Before buying into an HOA, residents need to carefully review the bylaws to determine if the HOA is something they can live in. Additionally, if you plan on becoming a board member, you need to have a full understanding of everything laid out in the bylaws to ensure you are handling every situation correctly.

Lien

A lien is a type of legal claim that can be filed against a property. Liens offer support for lenders and property managers; they ensure lenders and property managers can take legal action if they’re not getting paid by individuals or entities that are in debt to them (in this case, residents who live within their HOA community). With a lien, a homeowners association is protected if it’s not paid the money it’s legally entitled to.

Quorum

Quorums are typically determined in HOA bylaws and need to be closely adhered to. Essentially, quorums determine how many HOA board members need to be present to make a vote official. Typically, HOA boards have several board members, and a select number needs to be present for any vote to count. Before you buy into an HOA or join the board of an HOA, you need to find the bylaws for that property and discover what the quorum is, so you can be sure regulations are being followed at all times.

Reserve Accounts

Reserve accounts are exactly what you would expect. As an HOA board member, you know that you have reserve funds set aside for property emergencies and other situations. With help from a specialized consulting company like HOA Assist, board members are better equipped to manage the finances of the organization–which in turn helps ensure that your residents receive the best experience possible.

Contact HOA Assist Today

Looking for a company to provide you with accurate monthly financial statements and tools to empower you to communicate and run your HOA? Contact HOA Assist by calling 855-952-8222 or message us on our contact page today.