Buying a home is a big investment. Home ownership frequently includes automatic membership in a homeowners association (HOA). There are rights and obligations that come with being a member of an HOA. The information below is an attempt to give you basic understanding of what membership in an HOA may involve. To better understand what membership in a particular HOA might involve, you must review that HOA's governing documents and consider seeking the assistance of legal counsel to answer any questions

Some of the typical burdens of living in an HOA are restrictions, violations and assessments. No one wants to be told what they can and cannot do on their own property, however most communities have procedures that must be followed irregardless of how the homeowners "feels" about it. No one wants to receive a notice about their violation of an HOA rule. Owners are required to comply with all the rules and not just some of them. The board is required to act on violations in accordance to governing documents. Their job is to see that community is safe and remains a great place to live. Assessments are the most difficult burden. Most homeowners do not know or care how their dues are being spent until they are asked for more money. Each homeowner should review the annual budget and financial statements so they know how the HOA spends the funds. Reviewing these documents will show owners where they can reduce cost (example: deliver newsletters door to door instead of mailing, not damaging irrigation sprinkles heads when entering and exiting their driveways saving on replaced costs, returning required documents quickly instead of forcing extra postage and printing cost to mail the document several times. etc...) and keep their expenses to a minimum.

1. What is an HOA?

Washington law defines an HOA as a legal entity in which each member is an owner of residential property which is subject to the HOA's jurisdiction as a result of certain recorded governing documents. The Washington Homeowners Association Act, RCW chapter 64.38, provides more information on this issue.

3. What services and amenities are provided by HOA's?

The services and amenities provided by HOA's vary greatly from community to community. Services may include amenities in common areas such as swimming pools, tennis courts, playgrounds, trails, community center or even a golf course. Some HOA's provide landscaping services which range from just common area maintenance to full front yard maintenance, other services may include parking and security services.

4. What obligation does an HOA have?

Each homeowners association is different, but the most common HOA roles include maintaining common areas and amenities, administering and enforcing CC&R's and architectural restrictions, adopting budgets and collecting assessments.

5. Am I required to be a member of the HOA?

The governing documents for an HOA make membership mandatory for all owners within the community. The HOA's governing document are essentially a legally binding contract between the owner/members and the association. If you have questions about your legal rights and obligations as a member of the HOA, you should consult an attorney.

6. How does membership in an HOA affect the ownership of my home?

By virtue of your membership in an HOA, you will have various rights and obligations as described in your governing documents. These may include restrictions on use of your property, architectural controls on future exterior improvements, obligation to pay assessments (also known as dues), parking restrictions, legal consequences for violating the CC&R's, participation as a board member and attendance at the annual meeting.

7. Who is in charge of an HOA?

HOA's are typically governed by a board of directors or board of trustees elected by the homeowners. The boards responsibilities and power will depend upon the HOA's governing documents. The Board may also hire (or be required to hire) a management consultant to manage the day to day business.

8. How does the HOA enforce the governing documents?

The governing document of an HOA typically gives a wide range of powers to enforce its covenants, rules and policies. Associations may adopt fining policies, delinquent assessment policies, and rules and regulations for violating the CC&R's. Governing documents may include the power to file a lawsuit for damages or injunctive relief for non compliant property owners; as well as legal consequences for failure to pay assessments.

9. What happens if I do not pay my HOA Assessments?

The governing documents likely give your HOA the power to place a lien on your home or take other legal action if you fail to pay properly levied assessments. If you do not bring the assessment current, this can result in a foreclosure of your home by the HOA.

10. What is the difference between an HOA and a condominium association?

A condominium association is a specialized type of homeowners association. A condominium association is created under different statutes than those which apply to HOA's. Unless your governing documents state that your community is a condominium created pursuant to the Washington Condominium Act, RCW chapter 64.34, or the Horizontal Property Regimes Act, RCW chapter 64.32, it is not a condominium.

11. What happens if one of the common area of my HOA must be repaired or replaced?

Well managed HOA's will normally include an annual budget amount for minor issues. Larger issues would be included in reserves of annual budgets. Reserves are generally categorized as expensive, long term maintenance items that takes years to save for. Reserve items would be replacement of private roadways, playground equipment, septic facilities, entrance signs, filtration ponds, etc. Reserve items should be included as part of the annual budget and a specific dollar amount set aside to build the funds up over time. You should review your HOA's financial statements to determine if this is true for your HOA.

12. What is the amount of the assessment that can be charges by my HOA?

If you are a new buyer, you are entitled to a disclosure statement of the lot's current account status. New owners may be charge a "new owner assessment" or a "working capital" assessment at closing if the governing documents outline this fee. Monthly, quarterly, semi-annual, and annual fees should be stated in the CC&R's. Associations may also charge a "special assessment" or a "capital improvement" assessment if outlined in the governing document. Special and capital improvement assessments are generated when a specific item must be purchased for the community or a maintenance issues must be performed and will generally only be a one time cost. Typical charges may include purchase of mailboxes, septic facility, replacement of common area fence, tree removal, etc. These are items that may not have been included in reserves.

13. Can assessments be increased?

Typically, the governing documents allow for assessments to be adjusted based on the HOA's annual budget needs. Associations should create annual budgets from a "0" budget perspective - the income received is equal to the outgoing expenses. The governing documents generally allow the board of directors to increase dues by a specific percentage if the operating income is not sufficient to pay operating expenses. If a large increase is needed, homeowners must vote in person or via proxy to increase the dues. The Washington Homeowners Association Act requires that an HOA's annual budget be ratified by its members. Annual meetings are a good opportunity to ask questions as to how budget changes will affect your assessment.

14. Can my HOA restrict the types of improvements I can make to my home?

Depending on your governing documents, your HOA may have certain architectural or design guidelines and restrictions. If it does, there may be restrictions on the exterior appearance of your home. You may be required to submit plans and specifications for approval before you make any changes to the exterior of your home and/or build any addition or other structures on your lot.

15. What types of use rules might affect my home?

The HOA governing documents may contain rules relating to trees, landscaping, pets, satellite dishes, clotheslines, fences, parking, garage doors, trash cans, commercial businesses, rental of homes and other issues. You should carefully read the governing documents to understand the nature of these restrictions.

16. As a member of an HOA, can I rent my home?

The answer to this question will depend on what the governing documents for a specific community say. Some communities prohibit all rentals, some limit the number of homes that can be rented at any time, while other have no restrictions on leasing. Whether rentals are allowed, limited or restricted property owners should always let the HOA know if they have rented their property. This gives the HOA information about the renter along with a separate "mail to" address for the property owner.

17. When does my HOA meet?

In Washington, HOA's must hold a meeting of the membership at least once a year. Notice of the date and time of the meeting must be provided to each owner. Your HOA's Board of Directors will likely meet more often. Owners are allowed to observe these meeting and request copies of meeting minutes. The Washington Homeowners Association Act permits a board to consider certain sensitive topics in private (executive session) and exclude HOA members from that part of the board meeting. Executive session may occur in the middle of an existing board meeting or board members may be called to a special meeting. Typically, most board meeting are not closed to their members.

18. Can I attend the regular Board Meeting of the HOA?

The Washington Homeowners Association Act provides that the records of the HOA must be made available for review by owners during normal working hours at the office of the HOA or the managing agent. Typically attendance is for observation and open comments are not permitted. If a property owner has a specific issue they want to discuss with the board, they must put their request in writing to be included on the agenda. The board must listen to the homeowners concern, but the homeowner should not expect an immediate decision from the board. Issues often need researched so the board can discuss them and make a decision.

19. As a member of an association, can I obtain copies of the HOA's records?

The Washington Homeowners Association Act provides that the records of the HOA must be made available for review by owners. Certain information should be kept confidential and private and may not be available for coping, but available for reviewing. It would be a property owners responsibility to pay reasonable coping expense.

20. How can I determine whether the HOA of which I am considering becoming a member is facing any serious financial problems?

As a purchaser of a home within an HOA, you are entitled to receive a disclosure statement which will provide you with information regarding the financial condition of the HOA. This can be a simple form submitted by your title company or your can request a full disclosure statement. You must be specific on what documents you are requesting. You must also be specific and ask about litigation issues that may occur directly with your property, the communities common area property, or general association legal issues. Asking for the correct information will provide the buyer with a clear picture of the HOA's financial and legal condition.

21. Do the benefits of belonging to an HOA outweigh the burdens?

That is a question you should consider when buying a home in any homeowners association. Some of the typical benefits are shared expenses, property values, community feeling and a consistent feel and look to the neighborhood. You will never be fully responsible for all the cost to maintain the property. Homes in well maintained HOA's keep their property value and become very desirable. You know your neighbors and help each other out. The reason you liked the home in the first place was because of the look and feel of the community - You liked it so much, you purchased the home. Knowing that every owner is held to the same standard will ensure the communities continuity.
Some of the typical burdens of living in an HOA are restrictions, violations and assessments. No one wants to be told what they can and cannot do on their own property, however most communities have procedures that must be followed irregardless of how the homeowners "feels" about it. No one wants to receive a notice about their violation of an HOA rule. Owners are required to comply with all the rules and not just some of them. The board is required to act on violations in accordance to governing documents. Their job is to see that community is safe and remains a great place to live. Assessments are the most difficult burden. Most homeowners do not know or care how their dues are being spent until they are asked for more money. Each homeowner should review the annual budget and financial statements so they know how the HOA spends the funds. Reviewing these documents will show owners where they can reduce cost (example: deliver newsletters door to door instead of mailing, not damaging irrigation sprinkles heads when entering and exiting their driveways saving on replaced costs, returning required documents quickly instead of forcing extra postage and printing cost to mail the document several times. etc...) and keep their expenses to a minimum.