- The Washington Times - Wednesday, March 1, 2006

A new homeowner wrote that when he purchased a new lot in North Carolina to build a house, it

appears he’s also bought into a lawsuit between the board of directors of the ruling homeowners’ association (HOA) and the developer.

“My first concern is that this was something they started before I became involved and had no control over. Second, it seems that this is really a personal battle with a few individuals on the board and the developer. Third, after researching what I could understand, it looks that even if they are successful, the developer could just fix the problem at any time and send us the bill for his troubles,” the homeowner writes.

“I don’t know why they wanted to jump right into litigation with this since it looks like there are a few other avenues to explore,” he says. “It’s not that I can’t pay the additional $400 they are demanding from me, it’s that I’m worried this will just blow up in our faces and cost way more than anyone imagined if it’s even successful.”

Unfortunately, many homeowners find that once they buy a new home, they have also purchased into yet another level of government. While the local jurisdiction enforces state and local ordinances, HOAs govern and enforce items as small as the length of grass in the neighborhood, colors of the house and care of the common areas.

HOAs govern more than 240,000 communities in which 54 million residents live in 22 million homes, according to the Community Associations Institute, (CAI) one of the country’s largest trade associations for HOAs.

The CAI estimates that these groups collect more than $35 billion in homeowners’ dues.

For homeowners, those dues can be as little as $10 per month or as high as several thousand dollars each year.

As you purchase your next home, be sure you don’t just sign the bottom line of the HOA document disclosure without reading document items that will affect your life while living in your new home.

HOAs operate like a neighborhood government. Board members from the community run for office on the board of directors. The biggest complaint: A nosy neighbor who wins a seat on the board and abuses this newfound power.

As I was moving out of a condominium several years ago, many items had not been fully packed, and some of the items were being placed into storage. Some were still on the balcony temporarily.

One of the board members stopped me on the sidewalk to “instruct” me on the rules of what was allowed on the balcony. I was miffed at her authoritarianism. In fact, it was one of the reasons I was leaving.

I had heard stories about this person and several of her followers even getting access to keys to residents’ dwellings to check to see if they were abiding by rules that governed the interior of units.

Friends would say, “You should get an attorney.”

It’s easier said than done. For most residents, there’s just not enough resolve or money to create a legislative civil war to get someone out of your business.

Fortunately, not all communities are operated in such a manner. Most often, board members are truly there to operate the association for the better of the community and to protect home values and conditions.

Nevertheless, if you find that you want to take matters into your own hands, the frustrated homeowner does have some options dealing with an HOA gone awry.

First, look through your HOA or condo association documents for your recourse. It could be as simple as submitting a petition from a majority of the residents or as involved as impeaching the whole board.

Second, create a plan of action to bring your grievances to the board.

Be ready to volunteer for an existing committee or for creating and serving on a committee or task force to address the problem.

Third, have patience.

Your community wasn’t built in a weekend, and your complaint won’t be addressed in one either.

If your grievance involves complaints about dues or special assessments, keep paying these fees while you’re a resident or owner.

If you quit paying these fees, you put your case at risk.

In addition, if dues payments become too far in arrears, the board could even foreclose on your house to collect them.

M. Anthony Carr has written about real estate since 1989.

He is the author of “Real Estate Investing Made Simple.” Post questions or comments at his Web log (http://commonsenserealestate.blogspot.com).

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