Is this HOA legal?

Started by RodneyC3 • 6 replies • 1460 views

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RodneyC3 (North Carolina)
Posts: 3

Posted:

I am attempting to validate the “Legality” of an HOA in eastern NC. I purchased a home in a new subdivision of 60 planned homes. We currently have 20 homes built. The some of the residents were successful in pressuring the builders to allow an HOA to be established and the BOD / Officers were elected. However, the builders lawyer states the President must be one of the builders since they (the builders maintain control over the subdivision at this time). The builders Lawyer and builder also state everything must go to them for final decisions. A few of the power hungry members of the HOA Board have taken it upon themselves to begin the “Violation Hunt” and proceed with fines. By the way, there is no letter authorizing the establishment of the HOA that I know of since the Board refuses to allow me access to records. I have gone directly to the Builders with complaints (the establishment of a gun range in the subdivision), and now have become a target of the Board members. What recourse do I have since I do not believe this to be a legally established HOA.

TimB4 (Tennessee)
Posts: 21,059

Posted:

The authority for creating the Association would be within your deed restrictions (commonly known as the Declaration of Covenants, Conditions and Restrictions or CC&Rs).

Typically the governing documents are set up to give the builder (aka the declarant) full control of the Association until x units/lots are sold or x amount of time has passed. The members who show an interest in running the Association now will likely be the same ones who will run the Association when full control is given to the membership. To prevent this, you should become involved with the running of the Association.

Irregardless of being involved or not, as long as you pay your assessments on time and comply with the CC&Rs and other rules/regulations, you should have no issues. Make sure any approval you receive for changes to your property are in writing so you have proof of the approval in the future if needed.

Hope this helps,

Tim

RodneyC3 (North Carolina)
Posts: 3

Posted:

Thanks Tim for the rapid feed back. I plan to get involved. With the current board and anamosity among residents we have lost numerous prospective buyers to the subdivision. It amazing how 20 homes can have so much bickering. I firmly belive my home values which the present board says they want to protect is cause the downward spiral. It just becomes unpleasant a place to live looking over your back to see what is coming next. I have read CCR and other documents from the clerk of courts and I see a lot of things I would like to propose changes to but with the developer as the final say! I just don't know.

TimB4 (Tennessee)
Posts: 21,059

Posted:

If you can convince the developer to change them (perhaps by showing how it's beneficial to them) it will be an easier change than getting x number of members to agree.

KevinK7 (Florida)
Posts: 1,343

Posted:

Was this HOA created after you had purchased your home? Were the C&Rs filed after the purchase date?

RodneyC3 (North Carolina)
Posts: 3

Posted:

Kevin, the CCR were in place prior to purchase. I was informed at time of purchase that there was going to be an HOA but never given a copy of the CCR prior to purchase. I learned after the fact and of course my spouse says she would never have purchase if she had known. I was our mistake for not looking deeper and trusting the real estate agent. I am just to trusting an individual.

NancyG1 (North Carolina)
Posts: 119

Posted:

If it is a legal HOA it will be filed with the State of North Carolina. Contact the NC Dept of the Secretary of State (910)807-2000 and they can tell you or you can go online at http://www.secretary.state.nc.us/corporations/Corp. Our Association wasn't turned over to the homeowners until all the lots were sold. This is in our Covenants. Before turning over to the homeowners the Assoc. Board members was the builder and people that worked for his corporation. We only had 1 person from the community at the meetings to represent the community. Hope this information helps.

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