4. HOA fees affect how much lenders will let you borrow.
When borrowing money to purchase a home, lenders will look at potential taxes,
insurance, and HOA payments. These factors may impact your budget and ultimately
how much a bank will lend you.
5. You're required to pay assessments if you live in an HOA.
After you buy a home that belongs to an HOA, you automatically enter a mandatory
membership and are legally obligated to uphold your end of the deal: paying dues and
respecting the rules.
6. The HOA board of directors calculates your assessments.
A board of directors runs the HOA. These boards consist of volunteer residents, and they're
responsible for setting the annual fee amount. When determining the exact payment
required, a board will consider all operating, maintenance, and savings expenses, including
things like utilities, vendors, and insurance, among many others. Fee amounts for your
HOA will also be determined based on their needed reserve fund—money that helps pay for
future improvements and repairs.
