Little Known Facts About HOAs

The HOA Property Management Company (PMC) can demand payment from you without providing you with an invoice of what was done, when and line item cost.  Althought the PMC works for the HOA and is compensated by the HOA for its work they can separately Bill the homeowner for services (even though already compensated for such services by the HOA through homeowner assessments/dues).  This costly and abusive practice exists with the HOA Home Sale Transfer Fee when a homeowner sells their house.  If you don't pay it the home sale can be stopped.  The fee represents charges to provide the home buyer with HOA documentation and a final billing statement (already paid for with HOA dues and can be obtained any other day of the year free except at home closing.  This is duplicate billing at its finest.  Learn about this fee that costs homeowners in Colorado upwards of $15 million a year.  Learn all about this fee.

Your Board can change your HOA Declaration and other governing documents without approval of the homeowners.  The Board can petition the courts to approve a change in your governing documents even though the HOA Declaration indicates a vote of 66% of homeowners is required.  A vote on the Board's proposal must be conducted first, if 66% is not achieved but 33% (50% of what the Declaration indicates) voted for the change the Board can present their change to the courts for passage.  The one thing homeowners don't know is that if 33% of the homeowners object to the court about the requested judicial change it can't be implemented.  The judicial process can't be used to disband the HOA and a few other issues.  Here are a few articles on this topic:   article one    article two   article three and article four.  Your HOA's governing documents define the authority of your Board in changing HOA documents.  

Child care businesses are allowed in HOAs except for senior communities:  SB 126

Our Brochure on HOA Issues Rarely Discussed

Nuisance and harassment homeowner violations:  Not definitive under the law about specifically what they are but are judgement calls by your HOA and court judge.  If no covenant exists in your governing documents these can be used to impose fines and fees with wide discretion by the HOA or in some cases for the HOA to impose selective enforcement as they choos

HOA may have the right to enter your home!  HOA may  be able  to enter and inspect your home to inspect for rule violations or other reasons

The State HOA Office has no enforcement authority and no State entity has oversight of HOA property management companies or HOA Boards

Indemnification Clauses in HOA Management Company Contracts: shocking, costly:  HOA can be responsible for defending  a management company for their irresponsible  and costly acts.

The only affordable and accessible dispute resolution process for homeowners is our costly, litigious and time consuming court system.  This matches the homeowner's limited resources against the HOA's unlimited financial and legal resources: guess who normally wins.  Several state sanctioned studies have recommended a dispute resolution process be set up in the State's HOA Office but have consistently been rejected by the Legislature.  Learn more about this issue.

HOA Rentals, Absentee Landloards and HOA monthly fees:  HOA's permitting rentals should take measures and include such controls in their governing documents to ensure part of the renters monthly payment automatically goes to the HOA or an automatic payment is set up with the landlord to pay such dues.  Abusive speculators and renters are known to collect rent and not pay HOA dues.

HOAs are supposed to be managed by the Board but in fact nearly all are managed by the HOA's property management company.  Unfortunately, property managers are not licensed and this $2 billion a year industry has no State oversight.  Most homeowner complaints can be traced back to the direct or indirect involvement of the property management company.  With no State oversight of HOA or these companies and no place for homeowners to dispute issues with the Board other than our costly court system, HOA homeowner rights in State HOA laws or an HOA's governing documents are at best difficult to enforce.  HOA Boards should not allow managent companies to act in their behalf or operate with little oversight.

Some HOAs rely on fines and fees income to pay for administrative and other expenses.  This leads to an overly aggressive fine imposition polcy costing home owners and bringing about dissention between home owners and their HOA Boards.

55+ Communities don't have to have someone or all residents in the home to be 55+ and many can have teenagers

Insurance:  Many HOA homeowners (condo and townhomes in particular) are underinsured, not insured, have the wrong type of policy and are unaware of loss assessment insurance: TALK TO YOUR INSURANCE AGENT.    Ask about  HO-6  and loss assessment insurance and update your policy deductibles for inflation of your personal property.  Consider loss assessment insurance to mitigate financial obligations in the event you receive a special assessment to pay for the HOAs deductible

Metro Districts and your tax bill:  Is your HOA in a Metro District?  If so you most likely will be obligated at some time to participate in paying for the bonds issued by that district to pay for your HOA's infrastructure.  As a result, your property tax bill can increase thousands of dollars a year when paying off the bond debt begins. Ask your HOA Board to present your financial obligations for Metro District debt to the community explaining the amount of debt, when repayment is expected to begin and impact on your tax bill.

COLORADO HOA FORUM HOA HOMEOWNER ADVOCATES

DID YOU KNOW: LITTLE KNOWn FACTS ABOUT HOA'S