HOA Notification Requirements

David,

Now that you know the HOA is established, have you contacted them and squared things away (provided e-mail address, paid back assessments, gotten copies of governing documents, etc.)?

The answer to all of your questions is Yes.

Even though they failed to inform you, you are still obligated to follow the rules, pay back assessments, etc. However, the Association should be willing to drop any interest/penalties. This will probably require a letter or phone call to them. you may want to suggest ways to improve their communication to members (newsletter, website, etc.).

Tim

Well, we have Virginia, Tennessee and Oregon represented here and Oregon and Virginia reflect a group of home owners involved in the community. I am sure all have their problems but the two involved group have a handle on things because they were and are proactive. Good for you all, as bad as you imagine your association is, it is not so bad that you can't communicate on some level. The OP on the other hand is looking for ways to bend his association into a fixture that will solve his concerns. We on this site don't know who to blame or if any of what is posted is true. But we can see the gaps that exist in the OP association. Who's fault, who knows, but done is done and the solution is not behind you, it is in front of you. So, as an individual, take hold and if you are close to reality with your explanation, drag some others with you and make changes.
We are all saying, know what you are talking, know your documents, reference your closing documents to establish time line and don't expect anyone to move because you say, "I was told, or he said, or they promised me." Understand that you probably signed a contract that make you a part of your community, what ever it amounts too. Understand that you accepted the same responsibilities as the members of the Board did when they purchased, understand you are not going to resolve a problem, achieve your desires and walk away and forget it. In for a penny, in for a pound.

David, it appears there has been some faulty communication, and also there appears to potentially be a faulty understanding of communications that were provided.

When you were told that the "HOA" was not "set up," it's highly likely that the information was accurate, in that the person who told you that may well have been referring to the homeowner transition, or even a full board.

As long as an HOA is under developer control, and there has been no transition, a good majority of those HOAs do not function as they might after transition to the homeowners.

Rarely to developers have board meetings, rarely are board members even people the homeowners know. Many times they are employees of the developer, or contractors for the developer, such as the developer's attorney or accountant. Our developer's administrative assistant was listed as a director on our HOA's board prior to turnover/transition.

In fact, most HOAs "exist" as soon as the development is approved by zoning for building, even before any homes are actually built. It's simply all under the developer control, so it's sort of moot.

And deed restrictions can (and sometimes do) exist separate from whether a formal HOA entity exists.

None of our homeowners were ever notified of a board meeting until the very first board meeting occurred after the transition.

Is that perfect? No.

I'm curious as to whether you were given any deed restrictions at the time of sale/purchase of your property? Many times "by-laws" and "deed restrictions" (often referred to on this board as CC&Rs) are completely separate documents.

The deed restrictions are tied to your lot, they are dos and don'ts regarding a variety of limitations or allowances on your property, they run with the land and they are often enforced by an HOA board of directors.

The by-laws are typically the "corporate" document that lays out the structure of your HOA, describes the board of directors and the duties of the directors and any officers, describes who is allowed to be a director (sometimes), and often also describes the various meetings, voting procedures and eligibility, that sort of administrative stuff.

Often the by-laws will describe the rate and frequency of the assessments.

It is also not necessarily the responsibility of the HOA, or the HOA's board of directors, to distribute or ensure that the homeowners have copies of the by-laws or deed restrictions. That is really the responsibility of the SELLER to the BUYER (unless your state or other laws say otherwise, which I don't think Tennessee's does).

The homeowner should be aware of any assessment, but it would make good sense and be completely logical for the HOA board of directors to send assessment notices to each homeowner/member.

There is also probably a requirement in the governing documents that the board is to notify all members of all meetings, especially annual meetings.

However, if they are only doing this via email, I would protest loudly.

Anyway, as said above, they are probably up against a learning curve themselves if they are the homeowner board after the turnover.

If it's still the developer, well, then he's probably just being difficult.

As someone else said, it would be in your best interest to go ahead and make sure you are up-to-date on your assessments, make sure they have a contact address for you (if you don't want them to send email, I would be sure to PUT IT IN WRITING that you specifically do NOT want to be notified by email, but by USPS mail instead), and if they don't have any copies of by-laws or deed restrictions for you, contact your state's secretary of state for a copy of the by-laws and the county deed recorder for a copy of the deed restrictions.

Hope it gets better for you! As I said, that initial learning curve for a new board can be a bear.

To all thank you for your responses. I have learned a lot about my HOA through this board and making many phone calls. Here is a little more information for everyone that was so gracious to respond.

First: When I stated that the board was not set up I misspoke. The information that was given to us at closing was the HOA had not been transitioned to the home owners yet. I was still under the developer’s control.

Second: When I was questioning not being billed for my yearly dues it was more out of frustration. It was explained to us at closing that when the HOA transitioned to the home owners a yearly due would have to be paid. I was never against paying the due. I had been part of a previous HOA that was very well established and the HOA had been in the hands of the home owners for many years. My frustration comes from being on a list of people not paying the yearly due. I am not a person that does that and do not want to categorized as that especially by neighbors. If we would have known that the HOA had been transitioned I would have asked that question. I just assumed that the HOA had not been transitioned to the home owners yet and that is where I made my mistake.

Third: Pertaining to my question about being notified of annually meetings. Through talking to many other neighbors it was found out that several home owners were left out of these notifications and everyone that was left off of the notification had something in common. We all bought our homes from another “home owner” and not the builder. The home owners that were left out of this notification are looking into what can be done about this. During this annual meeting a new board was elected (come to find out only 7 home owners attended the meeting and all 7 are the new board).

Fourth: Addressing not receiving by-laws. We purchased the house from another “home owner” not the developer and at closing we were not given a copy of these. This was my mistake I should have asked for a copy. I have now obtained a copy. We never had any trouble following the rules I just knew that it would probably have some of the answers to the previous questioned I had.

Now that I have a copy I have reviewed them and I believe the association has three big hurdles to overcome.

1. First and foremost improve the communication to all home owners. We need to make sure that we have the contact information for all current home owners. This has caused the largest amount of anxiety among the home owners.
2. Second understand what needs to be done about the current board situation. About 1/3 of the total homeowners were not notified about the annual meeting. There are several people included in this 1/3 that want to be involved in what happens in our community.
3. Third: Convince the “few” that do not feel they do not need to pay the annual due because they were not billed to pay the annual due. We need to figure out how to convince them that this money is going to improve our neighborhood.

Again thanks to all that have responded and if anyone has any ideas on the next three hurdles I’m all ears!

David,

Thx for the additional info; it helps a great deal.

Hurdle #1: This is what happens when there are no state laws addressing disclosure. In AZ state law requires a homeowner or the board to provide certain documents and documentation to a prospective or new homeowner. This is normally handled through the title company. Since this is not the law in TN then I would suggest the board inform all members of the requirement to let the board know when their home is being sold so the gov docs and other info about the HOA can be provided the new owner.

Hurdle #2: Were the 1/3 of the total h/o's not notified of the annual meeting those members who did not purchase from the developer? Even so, I wonder why the board didn't know something was amiss. If the notice was sent to the address and was returned undeliverable, it should have set off alarms. Also when these people were not paying the assessment that should also have set off alarms. It appears the board has been too lax and the fault cannot be solely blamed on the fact that those h/o's did not purchase from the developer. If there are 100 homes in your community the board should be sending out 100 notices; if any come back undeliverable, they should check it out.

Hurdle #3: I think if you thoroughly read your CCRs you may find that it states that the assessments are an obligation whether the member receives an invoice or not. What these deliquent members need to know is, not so much that the assessments improve the neigborhood, but that paying the assessment is an obligation which they agreed to when they purchased their home. If they continue to be delinquent the end result may be foreclosure. I would suggest the board adopt a collection policy that outlines the exact steps that will be taken to collect delinquencies, i.e., what happens when 1,2, 3 or more months delinquent. The last resort being foreclosure. After adoption the collection policy is mailed to each member with a letter explaining that it will be strictly enforced. If a member misses getting an invoice that is NOT a reason for nonpayment.

Michele,

Yeah, you're right about forwarding. But, what about past due assessments? It just seems to me the board should have found out -- albeit the hard way -- that some of these homeowners had sold their homes. Of course we don't know what the make-up of the board is either. If they're all first-time HOA members, they probably don't know a whole lot about running an HOA. The OP didn't say, or at least I don't recall there being a mention of a mgr. It's just that 1/3 of the members not receiving notice of the annual meeting is an awful lot of the members.

I think it is inappropriate to jump to that conclusion at this stage for a variety of reasons.

First, "should have been a record of their owner information on file" -- with whom?

My developer just had an excel spreadsheet with the lots and owners listed. If the first owners sold to a second owner, how or why would the HOA office be involved?

In Kentucky it's not required for the HOA to be notified of a pending sale. So if the mailings were simply forwarded on to the former owner (and those mailings would get forwarded for up to 12 months), then there would be nothing coming back to the HOA to let them know that the title has changed hands.

If the meeting occurred and there was not the quorum required by the governing documents, and this is only the second year (or possibly the first and a half after transition), the developer is long gone. There is no one there to give the current board guidance.

My guess is that the board members haven't thoroughly read the documents and have just gone through a sort of mini-board boot camp with the developer previously, who said something along the lines of "You have your annual meeting on this day and that's when you elect officers."

I would be very surprised if there were any more guidance than that. The board at best probably doesn't know what it doesn't know or what it's supposed to know.

That doesn't mean they are corrupt. Following a bad lead is just that.

Locally, our municipality conducts two workshops a year geared towards neighborhoods and COAs and HOAs.

We get probably a couple hundred people a session. All of them are either in some leadership role in their community or wanting to be in a leadership role in their community.

At the very beginning, very few of them read very deeply into their governing documents. Most read just far enough to know, "well, we need a president and a treasurer, and I think a secretary. . ." but did they know HOW they were supposed to get those animals or what a quorum or proxy was (is)?

Very few did.

If this board/HOA had been around for say, 10 years, I might somewhat agree with you about the potential for being corrupt. But they are still in the learning curve phase. I doubt they know enough about the creature to be corrupt yet.

Seriously, I would still attribute it to lack of knowledge.

They are probably just feeling around in the dark right now and hit upon some "process" that the developer may have done (poorly even), and are just going with it.

I'm just basing this off of our own experience and learning curve we went through and off of the experiences and learning curves of the hundreds of other neighborhood leaders that I've met over the years who have been in similar circumstances.

We used to also send out pretty nasty violation notices right after the transition, too, because we were using the developer's "template" for them.

Over time (and I do mean "time" -- it took close to 5 years or more to finally get it "right"), we finally developed a reasonable violation notice "process," a template for first, second, and subsequent notices, built a database for tracking notices, etc.

Regarding payments, we had some issues there, too. It took us quite a while to hit upon the hodge-podge of "owner updates" process that we have now. Until then, we would just send out the assessments, hope that none came back undeliverable, and pretty much just assumed if no payment came back, the person just refused to pay.

In the first 2 or 3 years, our president was a realtor, so he had access to the PVA list for free. When he moved out, we lost that access and it took us bumping around in the dark for a while to figure out how to regain access to it. But it still wasn't a perfect solution. For example, when someone passes away, we don't know that. We sent a notice of intent to lien to a homeowner who had died about 6 months earlier. Her son contacted us with all kinds of vitriol. How could we have known if the PVA still shows her as "owner" and nothing comes back to us in the mail, or if her doesn't contact us to let us know?

Our developer also had a "list" of people who were non-paying, so we maintained that status list for years. If someone was on the list, then that meant they were not in good standing (i.e., did not pay) and were not to receive notices of meetings or ballots. We never once questioned "quorum" or "proxy" in those early years.

I would venture to say that we were probably in "violation" of our documents for a few board elections, too, early on, considering that some years only 10 or so people showed up to the meeting. But we didn't know what we didn't know at that time. We knew that we had to track non-payers, and that they couldn't run or vote. We had a "list," too, but we weren't "corrupt," just ignorant.

PS again: I see that the OP stated that he was on a list, but we don't know if HE was (maybe his name was added after the fact) or if the LOTS themselves were the list. In other words, I'm not sure that the list did include the updated names. I just don't know from what was shared. Of course, I could have misread something.

Gerald,

I don't know that it was selective notification. The OP stated that he found out the reason he didn't know about the transition of the HOA was because he didn't purchase his home from the developer. When a member sells their home they are not informing the HOA of the change in ownership. That could be why 1/3 of the members did not receive notice of the annual meeting. Also, I think there may be a very "green" board in control and perhaps no manager. They may not be doing anything about delinquencies either as I would think some of these changes in ownership would have surfaced when delinquencies started to pile up. There may be a lot of mismanagement going on for a number of reasons.

7 owners out of 70 to 80 show up for a meeting and not one of them thinks it improper to elect a board? there's green, there's ignorant, and there's corrupt. lets see how David's situation resolves itself, if he can provide any detail in his interaction with the Board.