Condo Association FAQ

An assessment, sometimes referred to as an “association fee”, is the dollar amount paid each month by the condominium owner to cover a proportional share of the common expenses for the property-such as hallways, roofs, gas, sewer, and exterior structures. Expenses are usually per-unit or based on square footage.
Assessments, whether billed monthly, quarterly, or a determined interval, are the same as Homeowners Association dues. The terms can be used interchangeably.

A Homeowners Association (HOA) is a legal entity created by a real estate developer for the purpose of developing, managing, and selling a development of homes. It allows the developer to exit financial and legal responsibility of the community, typically by transferring ownership of the association to the homeowners after selling a predetermined number of lots. Associations provide services, regulate activities, enforce the conditions, covenants, and restrictions (CCR’s) of the development, levy assessments, manage common amenities, and may impose any potential fines. All members of the HOA must pay assessments and abide by the regulations and restrictions of the association.

A Community Association is a general name for any organization of property owners to oversee common interests. It is a non-governmental association of participating members of a community in a defined geographic area.

A Neighborhood Association is a voluntary membership organization that deals with social, political, zoning, and other issues that typically affect the members’ properties, but usually does not maintain commonly owned properties. A neighborhood association may advocate for, or organize, activities within a neighborhood and can provide recommendations to the City Council on topics like land use and capital improvements.

Homeowners Associations and Neighborhood Associations are two separate entities. HOA membership is mandatory through rules tied to the ownership of property. Neighborhood association membership is voluntary. Also, HOA’s are primarily concerned with the internal business of the property and are generally established at the time the property is built and sold, whereas neighborhood associations typically exist is established neighborhoods, and are united by a common geographic area.
Association Management is a field of management that is unique to the environment of associations. Property owners are dues-paying members that comprise the association, and the association is managed by a governing body, such as an elected board, committee, or task force. Although management within the association environment shares many aspects of other organizational contexts, certain tasks such as development of non-dues revenue and fundraising and membership recruitment are unique to association management.
An association management company is a property management entity contracted by the association, in which the association delegates major responsibilities of the property to the management company. These responsibilities can include general maintenance, advisement on property-related matters, and assessment collection. Association management companies may manage several properties simultaneously, whereas others focus on individual properties.
If your community is not self-managed, the Association Management’s contact information can be found online, generally listed on the company website, or in the phone book.
A managing agent is a third-party organization or person that manages a property. A managing agent can be used to maintain property, collect assessments, manage building staff, etc.
A proxy is an individual appointed to act or vote on behalf of another owner by representing them at an association meeting. Proxy can also refer to a written document granting that power.
A quorum is a gathering of a minimal number of owners required to hold an official meeting of the association. The number required is outlined in the association’s governing documents.
A recuse is an act that involves temporary removal of an association member or board member, or the act of disallowing his or her participation in a particular vote, typically because of a conflict of interest.
Directors, in relation to an HOA, are officers charged with the conduct and management of its affairs, collectively referred to as a board. The board can be appointed or elected, with one member appointed to be the chairperson. Contact information for your community’s Board of Directors can be found on the Board’s website. Contact information, meeting times, and minutes should be available.
The Community Associations Institute is a national organization that provides education, tools, and resources to people who govern and manage homeowners associations, condominiums, and other planned communities. The CAI was initially formed to deal with problems involving association management, but has since turned its focus to advocating and lobbying state legislatures for policies that support responsible and effective management.
The term CC&R refers to ‘Covenants, Conditions, and Restrictions,’ the governing documents that dictate how the Homeowners Association operates and what rules the owners, and their tenants and guests, must obey. Many covenants are simple and meant to protect property value. Some are more specific, exterior color, satellite placement, etc.
Bylaws are a set of rules adopted by an organization to govern its own meetings or affairs. Bylaws can include voting rights, meetings, and other areas involved with the operation of the association.
Governing documents are any documents, including bylaws, which govern the standard operating procedures of the association.
A lien is a legal claim to property used to secure or obtain a debt, making it collateral against money or services owed to another person or entity. A lien can also refer to the security interest created by a mortgage.
The declaration, sometimes referred to as the master deed, is a document that must be registered by the original property owner prior to the conveyance of the first unit sold. The declaration describes the CC&R’s and the owner’s responsibilities to the association. The person or group of persons who either signs the original declaration governing the development and association, or acquires the original developer’s rights, is referred to as the ‘Declarant.’
An estoppel letter is a document used to facilitate the transfer of real property, and determines payoff amounts, assessments, and dues to be paid at the time of the closing. The document is sent to an HOA requesting payoff of a mortgage, and incorporates that amount into the Settlement Statement for the buyer and seller of the real estate.
An easement is a right in real property which grants the ability to a landowner to use the land of another for a special purpose. An association may have an easement for repair purposes.
A notice of non-compliance is similar to a lien, in that it is sometimes authorized under the CC&R’s, and notifies prospective buyers the property is in violation of the documents.
A common area is any property intended for shared use by members of the association (i.e. Hallways and laundry rooms).
An ordinance is an individual or set of laws adopted by a governing authority, specifically, a municipal regulation.