The 7 Most Frequently Asked HOA Questions
When you buy a house, you have a good chance of finding your ideal home inside an HOA. On the other hand, Joining an HOA can be more than new homeowners can handle. You are joining a community and signing a contract to uphold the rules and fund the maintenance of that community. If you have questions about what this means as a homeowner in a homeowner's association, you're not alone.
HOAs often deal with a few frequently asked questions by new homeowners and homebuyers considering what it means to join an HOA. Here are the answers to the most commonly requested HOA questions.
"What is a Homeowner's Association?"
A homeowner's association is when all the homeowners in a neighborhood communally share ownership of the neighborhood grounds. The roads, the lots, the parks, and the shared amenities all belong communally to the homeowners. Each homeowner has a vote and a responsibility to uphold the agreed rules of the community.
Each homeowner also pays a portion of the costs to maintain the shared spaces and manage the community. The types of things shared in cost and benefit by HOA homeowners include pools, playgrounds, holiday parties, seasonal programs, fitness centers, and sports courts. Of course, neither would be affordable for one homeowner to build, but when everyone shares the costs and benefits in the neighborhood, both become affordable.
"What Kind of Things Can an HOA Regulate?"
HOAs typically regulate the exterior care of your home. The goal is to help the neighborhood maintain its attractiveness and increase home values over time. That means a certain amount of uniformity in exterior design for most associations. Common regulations include
- Paint color
- Grass length
- Trashcan management
- Parked cars
- Snow removal
Always ask to see the governing documents of an HOA before you buy the house. This way, you know what is regulated and, therefore, if the neighborhood is a good fit.
"How Do HOA Boards Enforce the Rules?"
HOAs usually start with a citation, fees, and an escalation process for non-payment and continued violations. HOA's have the option to negotiate or escalate. Ideally, homeowners and HOA can reach an agreement through communication. However, an HOA can take legal action, place a lien on the property, or even foreclose a house in extreme situations.
"What Happens If You Don't Pay or Break the Rules?"
You will first receive communication if you violate the neighborhood rules or don't pay dues. This may be a note on your door, a friendly email, or a phone call. Ideally, the violation is dealt with shortly. Otherwise, you may face increased fines and legal consequences for breaking the terms of your HOA contract.
"How Much will an HOA Cost in Fees Each Month?"
Typical HOA fees range between $100 and $300 a month. However, depending on the community, monthly payments can peak as high as $1,000. Condos and townhomes are likely to have higher HOA fees due to the costs of maintaining a shared building and its insurance. Larger communities with more amenities and programs will likely have higher maintenance fees.
"Will HOA Fees Affect How Much You Can Borrow?"
Yes. When planning to borrow a new home, your lender will look at the total costs of owning a home when calculating your budget. Therefore, it means that HOA homes sell for more than just the listing price. However, the quality of shared amenities can often outweigh the apparent increase in home price. Additionally, you don't have to worry about NOA fees if your mortgage is customized.
Do You Have to Pay HOA Fees Even If You Don't Use the Common Areas?
Yes. As a co-owner of the neighborhood, you are also partly responsible for helping to maintain all the amenities. Your yearly dues pay for maintenance and repairs to keep everything in good condition. Each set of rights also includes progressive improvements to the area and events and celebrations that bring everyone in the neighborhood together.