Friday, June 15, 2012

Buyer Beware (Avoiding HOA Nightmares)

One of the biggest real estate investing mistakes I have ever made was purchasing a condo in the Fontaine East “community” in Dekalb County Georgia, a community lacking an effective (knowledgeable) Homeowner’s Association (HOA).  Actually, what I bought is a veritable property owner’s nightmare!

Once I realized just how much of a mess I had gotten myself into, I decided to be a part of the solution…and I was, for three years as my HOA board president. During the tenure of the board (neighbors) that worked together, we made many obvious changes/improvements to our community. We banned together to combat a growing crime problem, we lowered association fees and improved the overall HOA payment rate to nearly 47%, we removed board members (neighbors) who were serving (not serving), the interests, both neighborly and financial of the community.

Due to personal reasons…(I was verrrrrrry pregnant and placed on bed rest), I resigned my position as president and now, once again, my “community” is in dire straits. *To the point that I no longer feel safe and have been forced to move. There are abandoned vehicles throughout the community, crime has/is increasing exponentially, buildings and units are being vandalized, the pool has been allowed to become a cesspool and eyesore, the roof repairing schedule we had come up with is null and void, and the board (many of whom are the same people who were sitting on the board when I purchased my condo, are once again “serving” without being properly voted into office)…and this is just to name a few complaints! The folks sitting on the HOA board at this time, have raised HOA fees, they have placed liens on many owner’s homes, thereby causing many folks to foreclose, (further adversely affecting property values), AND MOST DISAPPOINTINGLY, they have fostered a general apathy among neighbors.  Additionally, since no visible signs of proper management nor improvements can be seen on the premises, most, homeowners (including myself), have refused to pay fees to folks whom have from the onset, proven that they really do not know (or do not truly care about), what they are doing!

Yes, I am fully aware of my contractual obligations in living in a mandatory HOA community, however, I am also very aware of the FIDUCIARY OBLIGATIONS owed me (and my fellow neighbors), from the board of “directors.”  It is quite obvious that those serving on the board of directors at this time are obviously ignorant to and careless with the value of the hard earned money of their “neighbors.”

Additionally, what is an extreme slap in the face to all the hard work previously done in the community, is the fact that there are a few “vendors” whom were forced, (via court order) to release our community from bogus contracts…who are once again being allowed to “service” and make undeserved money off of our community. Now, we also have board members serving who either by admission or by fact of research owe HOA fees themselves and yet they continue to (a) improperly and illegally SIT on the board, AND, (b) at least three members (who are admittedly behind in fees), one of which has been paid, in my opinion exorbitant amounts of money to make “repairs” in the community, have numerous invoices for “services” provided. This truly alarms and angers me, especially given that our community bylaws specifically outlines the degree to which board members are to be “contracted” to provide services for the community…it is an obvious conflict of interest.  AND YET, THE BOARD IS DILIGENT (VIGILANT) IN ATTEMPTING TO FORCE FELLOW HOMEOWNERS TO ABIDE BY THE BYLAWS AND DECLARATIONS OF OUR “COMMUNITY”!

My major concerns regarding my present HOA board and the impending demise of my community (and my hard-earned investment), is that the board is not fair in their enforcement of bylaws and covenants (as is evident in the fact that board members are obviously exempt from the ramifications and legal parameters for non-payment of fees); none of the board have ever been properly voted into their positions, and yet they expect homeowners to in good faith, give them access to our hard earned money, in the form of HOA assessments; they are rude and condescending to owners at the sporadic meetings they hold and do not and have not ever provided any substantial information regarding the management of our community (other than copies of a financial statement generated by a management company); and they continuously withhold from owners, what I deem to be pertinent and necessary financial information regarding the financial status of our “community.”

I guess my concerns and dissatisfaction with the manner in which this board is presently “serving” the community stems from the fact that I KNOW UNEQUIVOCALLY HOW WELL THE COMMUNITY CAN (AND WAS) BEING MANAGED WHEN THERE ARE PEOPLE WHO TRULY “SERVE” THE COMMUNITY (NOT JUST IN TITLE), AND AS WAS EVIDENCED IN THE NUMEROUS, VISIBLE, IDENTIFIABLE, POSITIVE CHANGES THE COMMUNITY EXPERIENCED WHEN NEIGHBORS CAME TOGETHER TO WORK AS A UNIFIED FRONT AND “COMMUNITY.”

Further, it just really pisses me off (please excuse me), that (1) when I was paying my fees, they were not doing jack diddly and yet because the prevailing laws regarding HOA’s in no way serve, protect, nor offer real recourse to home owners, I am expected to basically donate my money to folks undeserving of having access to my HARD-EARNED MONEY; (2) the audacity of board members to think that I am willing to give them my hard earned money (to put in their pockets…I wouldn’t mind board members having contracts with the community if I could actually see things being done); (3) board members are jeopardizing home owner’s investments both individually and as a collective, for fee payment negligence, (when several of them are negligent), AND, (4) the blatant arrogance in their wrong doings.  It really makes me want to spit, every time I drive into my community which is more aptly described as a “ghetto” now.

In my personal search to find some relief and escape from my neighborly nightmare, I have come across the following helpful information that other disgruntled homeowners may find useful in learning more about condominium laws and rights as a homeowner.

1 - Do a search of your state’s official government homepage and look for links to state “laws,” “statutes,” “codes,” or “legislation.”

2 - For general information on homeowner’s association law, try visiting the Community Associations Network.

3 - Visit the Community Associations Institute on line which offers a myriad of information, resources, publications, and legislative activities.

4 - Attempt to work with your neighbors in making your community a nice place to call home, BUT, if this fails, take more drastic measures to save/protect your investment.

5 - Galvanize other concerned neighbors and work to have board members removed who are not serving the best interests of the community.

6 - Start a letter writing campaign (as I have done).  Write letters to anyone and everyone who will listen.  Contact elected officials, attorneys, judges, newspapers, radio stations and anyone willing to hear you and your neighbors out.

7 - Ask to review your community’s files and records (as is the law pursuant to The Georgia Non-Profit Corporation Code. *Homeowners are allowed this right REGARDLESS AS TO WHETHER THEY ARE DELINQUENT IN HOA FEES OR NOT.

8 - Hold your board of Directors accountable for any and all financial decisions (contracts entered into on behalf of the community), monies spent/disbursed; reserve account balances, etc.

If all else fails, contact a good lawyer(s) (as I have done) and research your rights and abilities to sue.
In the end, unless you are fortunate to sell your property and move on, neighbors will have to come to a happy medium and learn to work with each other…and in the case of HOA boards, work for the best interest (both financial and neighborly), of one another.

Courtesy: Yolanda J. Ash
http://yolandajash.com/real-estate-and-investing/buyer-beware-avoiding-hoa-nightmares/

This article is not intended to be specific legal advice. It only provides general legal information. You should consult a licensed attorney if you have a legal issue.  


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