FAQ about HOA'S

What is a Homeowners Association?
 
A Homeowners' Association (HOA) is a legal entity created by a real estate developer for the purpose of developing, managing and selling a community of homes.  It is giving the authority to enforce the covenants, conditions and restrictions (CC&R) and to manage the common amenities of the development.  It allows a developer to end their responsibility with the community, typically by transferring ownership of the association to the homeowners after selling their lots. 
 
What is a Board of Directors?
 
In relation to an HOA, a director is an officer charged with the conduct and management of its affairs.  The directors collectively are referred to as a board of directors, and are generally elected or appointed.  Sometime board will appoint on of its member to be the chair, making this person the President of the Board of Directors or Chairman.
 
What is the Managing Agent?
 
A Managing Agent is a person or entity hired specifically to assist the board of directors in enforcing the documents and managing the assets, funds, and interest of the association.
 
What are Governing Documents of a HOA?
 
The principal governing document of an HOA is often known as the Declaration of Covenants, Conditions, and Restrictions and Easements (CC&R).  Other important HOA documents may include Articles of Incorporation, Bylaws, Rules and Regulations.
 
What is Covenants,Conditions and Regulations, (CC&R)
 
Initially drawn up by the developer or "declarant" during or before construction, usually by the attorneys.  This document is recorded in the county where the property is situated and "runs with the land" - that is, when  you purchase your home in this Association you are legally bound to the provisions of the document.  The CC&Rs outline the manner in which your Association shall operate, such as how assessments are to be levied, remedies for non-payment of assessments, Board members' powers and duties, Board members limitations, homeowners responsibilities and obligations for maintenance, use restrictions, how certain policy is to be established and carried out, Insurance requirements of the Association and of the individual homeowner, and much more.  You should have received a copy of this document while your home was in escrow.  If  you did not, you should immediately contact your Escrow Company or real estate agent.  You can also obtain a copy from the Management Company, however, there may be a processing and reproduction fee. 
 
What is Bylaws?
 
Where the CC&Rs outline the operational plan and requirements the Bylaws outline the manner in which the CORPORATION shall operate and will focus mainly on how the Board of Directors are elected, terms of office, vacancies, notice and quorum requirements for Association and Board of Directors meetings, and sometimes powers and duties of the Association and/or Board. 
 
What is Articles of Incorporation?
 
This is a simple document that is filed with the State.  It establishes your Association as a corporation, for profit or non-profit (usually the latter), tax exemption status, and gives specific purpose of the Association
 
What are Rules and Regulations?
 
These are established by the Board of Directors, either annually or on an as-needed basis.  These shall serve to supplement the CC&Rs "use Restrictions" section by adding specifics.  Such Rules will expound on the use restrictions, architectural provisions, parking enforcement, and the manner in which disciplinary action is taken in event an owner or resident fails to observe any of the governing documents. 
 
What are Assessments?
 
The assessment, sometimes called "dues" is the monthly, quarterly or annual  maintenance fee each member pays to cover the cost of maintaining the common areas, which might include the landscape, pools, roofs, painting, various administrative costs, utility costs and reserve funding. When you purchase a home in an Association, thereby agreeing to become a Member, you also agree to pay this assessment for as long as you are a Member. You should have received a copy of the annual budget for your Association   This will outline in detail where your  dues are allocated.  Occasionally your dues amount may change, depending on the decisions of your Board of Directors 
 
What is a Proxy?
 
An individual appointed to act or vote on behalf of another person by representing them at a meeting of the association.  The title can also refer to the written piece of paper granting the power.
 
 What is a Quorum?
 
A Quorum is defined as the minimum number of owners required to hold an official meeting of the association.  The number of owners required can vary greatly according to the corresponding associations governing documents. 
 
What is Common Area?
 
Any area of improved real property intended for shared use by the members of the association.
 
What is Easement?
 
An interest or a right in real property which grants the ability to a landowner to use the land of another for special purpose or endeavor.  An association may for example have an easement for slope maintenance or other repair purposes.  A public utility may also have an easement for maintenance or repair work to be executed at a future date.