Ebooks

HOA TERMS & DEFINITIONS Like any organization, HOAs use a language of their own. The following are commonly used HOA terms and what they mean. Homeowners' Association (HOA) HOA is short for homeowners' association. They're established as non-profit organizations to help manage, run, and maintain a community. Architectural Review When an architectural review occurs, a homeowner submits planned property changes for approval, and the board will accept or reject the proposed changes, usually with additional feedback. Quorum A quorum is the minimum number of owners needed to hold a meeting. Having a proper quorum is critical anytime the board conducts official business, changes rules, or votes. Fiduciary Responsibility Fiduciary responsibility means the board has an ethical and moral obligation to make decisions that benefit all residents, not just a single home. Governing Documents This collection of legally-binding documents includes the declaration, bylaws, rules and regulations, articles of incorporation, and other materials that govern day-to-day operations. HOA Fees HOA fees are typically collected on a monthly, yearly, or quarterly basis. The amount varies, but these fees go towards operations and the funding of an HOA reserve. HOA Reserve Fund The board is required to fund a reserve account for the community, which is collected to cover necessary capital improvements like parking lot resurfacing and painting. Budget A budget is an association's financial plan that estimates income and expenses for a specific period. HOA Special Assessments Special assessments are additional fees used to pay for budget shortfalls or unexpected costs. A board must vote on an assessment before charging additional fees. HOA Fines When an HOA rule or regulation is violated, a fine can be issued. Fine amounts depend on governing documents and other laws.

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