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VenaN (Georgia)
Posts: 1
Posted:
Hi.
I’m a newbie. Our neighborhood is located in metro Atlanta. 8 years old. We currently have about 120 homes. There are another 80-100 lots waiting to be built on. It’s a beautiful neighborhood and everyone is glad they live here…that is until they’re here for a while.

We were all stupid. We all wanted to live in this neighborhood so bad, we all signed the HOA agreement at closing, not reading all the fine print. We assumed it was your typical HOA contract we’ve seen many times at closings. I’ll try to provide background and context.

Turns out the HOA is one person – the developer - until EVERY lot is sold. (he will probably just hang on to one lot to maintain control) He is not transparent about where our dues are being spent, using vague terms like “attorney’s fees”, “landscaping”, etc. We have no breakdown of what we are actually paying for. Just what is in the landscaper’s contract? We have no idea, we just know they’re lousy for the amount we’re paying.

We’ve asked to see more detailed records and contracts, but got nowhere. Is there any way we can get a copy of all the contracts the HOA has made?

Our neighborhood common areas need maintenance and an infusion of cash. We have a neighborhood sprinkler system that he doesn’t turn on and our landscape dies. (Good luck getting the landscape crew to come by and replace it.)

Last year we were told we all needed to repaint our houses BUT we could only use HIS approved painter.
He decides if we can have a community wide event, even though he allocated 10k in our annual budget for them.

He never returns phone calls and only communicates with us by certified mail, FOR EVERYTHING, when often a simple email would do….paid for out of our dues. He is very, VERY, litigious and it is my understanding that if he’s suing anyone in the neighborhood THOSE attorney’s fees are also taken out of OUR dues. He puts liens on houses any chance he can get. All in all, he’s unresponsive, uncooperative and seems to be suffering from Napoleon syndrome. 
It’s all very shady, not to mention depressing. Many suspect he is lining his own pockets with OUR dues. (By the way, he raised dues 40% this year!)

The builder is no longer working with him because he’s being so unreasonable. He nearly doubled the price of lots and told him he had to buy 10 at a time. All building here has stopped.

There has been talk of taking legal action, but we can’t use any of OUR dues to hire an attorney, but he can use them to pay for HIS! Even if we could, we couldn’t afford attorney’s like the one’s he has on retainer. Other developments have tried, refusing to pay their dues. He put a lien on their houses. Others took him to court and ended up sued, some financially ruined.

Enough of my sad story. Is there ANYTHING, any recourse we can take? Should we go to the media? (He’d probably sue us.) Politicians? Any other route? We have lemon laws for cars. Is there anything like that for a developer run HOA’s that is out of control? If not, there should be!

We are reasonable people trying to work with a greedy, litigious S.O.B. Has anyone else ever found themselves in this situation? Any suggestions would be greatly appreciated!

SheliaH (Indiana)
Posts: 6,964
Posted:
If the developer is now having beef with the building, it may not be too long before he/she's history because it sounds like he/she's incompetent at best (probably overextended the budget in a big way) or crooked - prehaps both. I suppose you could go to the media, but since the developer calls the shots anyway at this point, you need to look at what he's supposed to be providing vs. what's actually being done or not. If any of that is in writing, you might have grounds to sue for breach of contract, but you'll have to talk to an attorney about that.

If there are conditions that are beginning to threaten health and safety, you could go to the media about that and see what happens, but media attention is a two edged sword. On one hand, the bad publicity might force the developer to do what he should be doing, but the bad publicity might turn off potential buyers, more money problems ensue and then the developer declares bankruptcy and turns a hot mess over to the homeowners.

Until the community is turned over to the homeowners, the developer runs the show - it sucks to hear that, but it's the truth.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius
PitA
Posts: 1,416
Posted:
{quote].... we all signed the HOA agreement at closing, not reading all the fine print.


Your only PRACTICAL option at this point is to relocate.

unless

You are willing to begin AND FUND a protracted and expensive legal battle.

however

IF, repeat IF, the HOA is incorporated there ARE corporate laws.

You, by virtue of ownership, would be a member of said corporation.

To whom EXACTLY do you make out your assessment check(s)?

Search the Georgia Secretary of State web site for the corporation.

Send the Registered Agent requests for budget and any other documents you want.

Be prepared for your life to become 'hell on earth' unless YOU are in PERFECT compliance with ALL the Covenants and Restrictions and can PROVE same.

next time around the block: CAVEAT EMPTOR
PitA
Posts: 1,416
Posted:
oops, no edit capability:

.... we all signed the HOA agreement at closing, not reading all the fine print.


Your only PRACTICAL option at this point is to relocate.

unless

You are willing to begin AND FUND a protracted and expensive legal battle.

however

IF, repeat IF, the HOA is incorporated there ARE corporate laws.

You, by virtue of ownership, would be a member of said corporation.

To whom EXACTLY do you make out your assessment check(s)?

Search the Georgia Secretary of State web site for the corporation.

Send the Registered Agent requests for budget and any other documents you want.

Be prepared for your life to become 'hell on earth' unless YOU are in PERFECT compliance with ALL the Covenants and Restrictions and can PROVE same.

next time around the block: CAVEAT EMPTOR
StephenZ (Texas)
Posts: 13
Posted:
We went through this exact scenario for our 12 yr old development. Here is what we did.
1. We formed a group of concerned homeowners and met to discuss and research our options.
2. Once we understood the ByLaws and CCR's as a group, we requested a meeting with the Management Co.
3. The Management Co. is required by Law to abide by the ByLaws and CCR's.
4. All of us individually requested copies of the current budget and asked to review all Board meeting minutes.
5. The Management Co. had done a poor job of gathering this information and could not provide us this information.
6. We individually told them in writing that we would report them to the District Attorney's Office.
7. As this Management Co. know they were breaking the laws with their relationship with the developer, they decided to quit.
8. This forced the Developer to hire a Management Co. with integrity.
9. How the Developer was running the HOA now became much more transparent and the new Management Co. would tell the developer no on how he wanted to run things as it was not allowed by law.
10. We set-up a fund of $10,000 to hire a lawyer to investigate.
11. Lawyer sent a letter to the Developer requesting all documents. Lawyer did not expect to get a response as this was just a scare tactic.
12. Developer finally realized he could no longer steal us blind and turned over the HOA to the homeowners.

I won't sugarcoat this as it was exhausting and took us 6 years to accomplish but we now run everything.

Here is what we found out after taking over.
1. Developer used his own landscaping Service at 10x the going rate in our area.
2. Increased dues every year by the max allowed in the BYLAWS.
3. Did not enforce deed restrictions.
4. Only had one yearly meeting in 10 years.
5. Loaned money from his own business to pay HOA bills.
6. Did not pay for street lights all the time.
7. Ruined the HOA credit

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