How to Buy a Home With an HOA
Buying a home requires the review of many documents and disclosures. Home inspections, title reports and appraisals are only some of the paperwork that you receive after signing a purchase contract. In addition, if you buy a home located in a neighborhood governed by a homeowners association (HOA), the seller must furnish you with disclosures about the association and rules that homeowners must follow. These documents are important because the HOA can have requirements -- such as not being able to run a business from your home -- that can impact your use of the property.
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Instructions
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Ask your real estate agent, closing officer or seller for the HOA disclosures as soon as the purchase agreement is signed. As a contingency to purchase the home, the seller should not delay in meeting the request so the close stays on schedule.
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Ensure that the seller pays the management company, which oversees the property development and enforces the HOA rules, the necessary fees needed to have the documents copied and sent to you. Without payment, the paperwork will not be processed.
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Attached to the disclosures should be a form that gives you the information about HOA fees and increases, the name of the management company, a list of lawsuits or judgments against the association and an acknowledgment of receipt of the documents.
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Review the disclosures carefully. Included you should find the articles of incorporation, bylaws, governing documents, rules of use, budget and financial documents, one year of board meeting minutes and the association's covenants, conditions and restrictions.
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Sign the form showing that all buyers received and read the HOA disclosures and documents. Fax a copy of the form to your real estate agent and closing officer.
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References
- HOA Document Review; Disclosure Complicated for Condos; Ron Rossi; 2008
- Rox Real Estate; New Bill Limits HOA Document Fees; Linda Pixler
- KemOnWheels.com: Home Owners Association Seller Disclosures and Transmittal of Documents
- Orange County Home Value Guide; California Home Sellers HOA Info and Document Disclosures to Buyers; Harrison K. Long; 2011
- U.S. Small Business Administration: Can a Homeowners' Association Ban Your Home-Based Business?
