Fake HOAs in Tennessee

I joined this website after my daughter purchased a home in Tennessee, and we soon discovered that not only was the HOA a fake, but that no one seems to care. After searching through this site, I see I'm not the first one to discover the problem.

There is no board of directors, no meetings, no annual statements, just a management company that can charge her what ever they want and do whatever they want, without recourse. As a retired Real Estate Broker, I was shocked.

I'd like to start a discussion with others in the state as to what can be done about this. The least of which would be to stop allowing this money making scheme to be called an HOA.

Cynthia,

Three possibilities (there may be more):

1) The development is still under control of the developer (Declarant). As such, they may or may not have formally formed an Association but did hire a management company to collect assessments as required in the deed restrictions (CC&Rs).

2) The management company is serving as a receiver and reports to the court.

3) There is a Board but nobody wants to serve on it. Therefore the management company is performing tasks as outlined in their contract. OR There is a board and nobody ever steps forward to serve so the current board members choose to not hold an annual meeting.

Most likely, I suspect #1 or #3 above is what is happening within that Association.

And look at the deed carefully to see what it says about restrictions and/or covenants that apply.

Follow up to my original post.

The HOA was indeed a fake. The association had been taken over by a management company who had been stealing funds. It took almost a year for the homeowners to take control. We lost tens of thousands. They are no longer our management firm. The expense of going after them makes it not worth our while to take them to court.

Lesson here, don't trust Associa

Good question.

Overuse of the word "fake". Often observed being trotted out by those who watch too much television.

By my dictionary, "fake" means "not genuine", "counterfeit", or "a thing that is not genuine; a forgery or sham".

I'd say that the HOA in question fits that definition and is thus fake.

I agree.

Whoa, personal attacks directed at me.

I do live in this HOA with my daughter, who is the owner. We did read the CC&Rs and the by-laws prior to purchase. After more than a year of no communication with either the management company nor any supposed HOA board of directors, I got suspicious and started making inquiries. Hence the original post here. Eventually, I encouraged my daughter to work with other homeowners to take back control. It was a year long fight and required an attorney.

I call it fake because there was only one board member for three years who did not read the CC&Rs nor the bylaws. Instead he chose to listen to the management who company who told him he was president for life a direct violation of the bylaws. They were using him as a figurehead to steal funds. They posted false charges to accounts which were found in a full audit when we left the company after fighting to get out of our contract with them. These charges included inspections that never happened, charges for insurance coverage that was did not exist, and regularly charged late fees to homeowners who paid regularly and on time. Additionally, they continued to record payments to a landscaper they had fired months before. So maybe fake is the wrong word. How about questionably legally? How about corrupt?

The homeowners are all either investors or first-time home buyers. The investors didn't want to mess with low HOA fees and the first-time home buyers still had the mindset of renters. It was only when this retiree got suspicious that they started making inquiries. The original management company was hired by the developers. That company was purchased by Associa. The homeowners were unaware of the purchase and thought it was just a name change. They didn't know they could fight back. So, since I'm not the owner of record, I got my daughter to lead the charge. She is now the HOA president and things are very different.

Normally, I wouldn't have mentioned the name of the management company in question, but I write this as a cautionary tale. The more I researched Associa the more skeptical I became of their motives. You are free to do the same research yourself. I have to conclude that if you are so upset by this warning that you have a personal stake in the matter. That still is no excuse for your attempt to bully me.

When one is questioned about inaccurate statements, it does not mean one is being bullied. No one is bullying, but the dots didn’t add up initially - and, this site gets a lot of nutters - so, let’s start parsing the story into pieces.

Saying things like “the HOA was indeed a fake,” is not accurate. The HOA was and is real, but is poorly, perhaps criminally managed - and since that is the job of a Board of Directors, it sounds as if things are improving.

Why would people attack the poster in this thread? FayeE's other thread about property managers that claim voting rights on the board also suggests that there are unscrupulous property managers; hers also ought to be reprimanded. Lawyers, doctors, accountants, etc. all can be hit with malpractice suits; why can't property managers who do such things; isn't there an ethics code for property managers?

Some of the posts to this site are by folks who may be well meaning, may be incredibly confused, may be absolute nutters ... i.e. we only have what they post to go on.

So, we ask questions in the hope of better understanding.

Well said.

I think that someone who confuses the legal existence of an HOA (as evidenced by the presence of recorded CC&Rs and bylaws) with the alleged misbehavior of a management company employed by the HOA is displaying a pretty fundamental lack of understanding of how these things work. Comments that suggest the same confusion four years later.... *shrug* Most folks do begin to figure it out after a while.

But your mileage may vary.

I didn't notice any comments that could be viewed as implying anyone is a Trump supporter. This thread was started in January 2016, well before he was more than a blip on most people's radar, and before the term "fake news" began to be slung around. Anyone who pays attention to current events has come into contact with the expression, and it's a stretch to read a particular political position into it. I've found that ignorance about how HOAs work is not limited to any one group of persons, no matter how you may classify them.

I agree.