The term HOA is used to call the homeowners association within a neighborhood, community or residential complex, which is made up of the developers of the project and who are the initial buyers, with the objective to manage and maintain the houses within the project.
When you buy an apartment, townhouse or other type of property in a housing complex, you are required to participate in the owners’ association of that community, making a monthly contribution in money that is fixed at a meeting of the members of the same association.
In some countries, this association is called condominium and when we talk about payment of the condominium, it refers to the monthly payment for the benefits of the maintenance that this offers of common areas and others.
When purchasing a property that is in a residential complex and has HOA fee, you do not have a choice, you will have to pay this monthly fee or the association will eventually place a withholding tax on the property and possibly be removed.
So the advice is to seek the necessary advice from your realtor, before buying a home and knowing that HOA fee is within your reach. Some people do not see benefit to pay the fees of association and do not buy properties where these fees are charged. Others like this type of neighborhood because they offer benefits like swimming pools, gyms, tennis courts, maintenance of common areas and exteriors of buildings, among others.
Some states have large regulatory bodies about the laws of owners association management while others do not have owner association laws. Before you buy a property that has fixed HOA payments, you should take the following into account;
- The association’s payment must be affordable within your monthly budget.
- Read the rules of the HOA carefully and if they are in a different language, ask the advice to your trusted realtor to avoid any inconvenience or delay in payment.
- Remember to keep up with the monthly payments of the association and make sure to do them within the set time, delays in the payment can cause you arrears interest, and finally some type of penalty in your record.
- Some associations hold meetings from time to time to elect managers for a period, and these positions may include a president, vice president, treasurer and publicist.
- Be sure to keep up to date when and how fees increase and have access to the memory and account of association funds to review how the annual budget was distributed, and which projects were completed and which were pending.
- In certain residential complexes, HOA is managed by a management company that offers webpages with information and payment systems for your convenience.