Fifty-five million Americans live in community developments regulated by a homeowners association (HOA), and one in five of those HOAs report problems. Typically, those problems involve excessive use restrictions, such as how many cars a homeowner can park, and where he can park them. Homeowners in such communities are bound by the terms of the HOA. Many don't know what they've signed up to, until it's too late.
Developers establish HOAs when they first construct a housing community. Their primary purpose is to look after the common facilities of the development, such as landscaping, community buildings and tennis courts, and to provide services for the benefit of the community, such as clearing snow. HOAs are not-for-profit organizations. Volunteer elected homeowners sit on the board, and have the power to promulgate rules. All homeowners within the community are members of the HOA, although some take a more active role than others.
All homeowners within a community must comply with the HOA governing document, known as the Covenants, Conditions and Restrictions (CC&Rs). The HOA board is empowered to police such compliance. CC&Rs vary between HOAs, but typically a homeowner can expect to have restrictions placed on exterior paint colors, driveway parking, pet ownership and even where his laundry hangs to dry. According to Realty Times, the wording of a typical CC&R document is vague. The HOA board determines the intent of the CC&R and supplements it with a rule book or set of by-laws, voted by member majority, which is a list of everything that a member can and cannot do. The rules cannot contradict the express terms of the CC&Rs.
Each homeowner agrees to comply with the CC&Rs as a condition of taking ownership of a community home. These are legally binding covenants which the HOA is authorized to enforce, in accordance with the CC&R and rule book. Typically, the board levies fines against the recalcitrant homeowner, and has the right to enforce that fine in court. In other words, if the CC&R or rule book says that a homeowner must park his car in the garage,the homeowner must park his car in the garage, or face the legal consequences.
A homeowner wishing to challenge a restrictive condition is not in for an easy ride. His first step is to establish whether the condition is lawful. To do this he must study the HOA constitution documents, CC&Rs, rule book and board resolutions alongside state not-for-profit law, to determine whether the HOA board has acted properly in enacting the restriction. If the HOA is acting outside the scope of its powers, the homeowner can mount a legal challenge. This can be as simple as writing a letter, or as complicated as a lawsuit. Neither is it straightforward to obtain a personal waiver to an otherwise enforceable condition. The homeowner must typically apply to the board with a fee, before submitting his grievance at a formal hearing.
Jayne Thompson earned an LLB in Law and Business Administration from the University of Birmingham and an LLM in International Law from the University of East London. She practiced in various “big law” firms before launching a career as a commercial writer specializing in finance and tech. Her work has appeared on numerous financial blogs including Wealth Soup and Synchrony. Find her at www.whiterosecopywriting.com.