Lawyers Share 10 Things They Wish Everyone Knew About HOAs

Conventional wisdom tells us that buying a home and creating equity is one of the best ways you can build wealth.

However, the type of property you purchase can really make a difference in your ability to succeed in those goals, especially if that property is located in a homeowners association (HOA).

HOAs can seem restrictive and even scary, but you do have legal rights that can protect you and your investment. 

To find out what you need to know, we spoke to several lawyers to find out what they wish everyone knew before purchasing a home governed by an HOA.

One of the most important things to do is read and fully understand your HOA's governing documents, according to attorney Scott Distasio, founder of Distasio Law Firm in Tampa.

"These documents — which include covenants, conditions, and restrictions (CC&Rs), bylaws, and rules — dictate the terms of living within that community," he says.

That can include everything from the color you paint your fence to what pets you have, helping manage expectations out of the gate.

"Many potential disputes can be mitigated, and in many cases even evaded, if homeowners take the time to thoroughly familiarize themselves with these documents," Distasio continues.

"I urge clients to assess the financial health of the HOA," says attorney David Greiner, president of David J. Greiner Law Corp in Southern California. "Look into the association's budget and reserve fund to avoid potential financial issues or unexpected fees."

That's an excellent tool for staving off regret, adds attorney Martin Gasparian, owner of Maison Law in California.

"Many of my clients wished they had been more in tune with the procedure of checks and balances with their HOA administrators, down to shared budget financial sheets," he says.

Special assessments are a huge issue in the wake of the Surfside condo collapse, cautions attorney Danny Karon, founder of Karon LLC in Cleveland.

"Condo buildings nationwide (and especially in Florida) insisted on structural reviews," he says. "And if a structural review indicated significant risk, special assessments of perhaps as high as $100,000 were payable by condo owners."

And if homeowners can't afford to pay the special assessment? "They risk losing their home to foreclosure and having a personal money judgment against them," he continues.

You have power as a member of your HOA, notes attorney M. Denzell Moton, founder of Moton Legal Group in Atlanta, and he encourages you to use it.

"Active participation in meetings and decisions can significantly influence how rules are shaped and enforced," he says.

"I've seen clients successfully advocate for changes that make living conditions more favorable by being involved." That means it's worth your time to step up.

"While it might seem like an HOA's rules are set in stone, homeowners have the right (and should be encouraged) to contest rules they find to be unreasonable or not in their best interest," says attorney Mark Pierce, founder of Wyoming Trust & LLC Attorney.

Even if the rules seem complex, confusing, or restrictive, Pierce says HOAs can act as a vehicle for change.

"HOAs can be an instrument of community improvement, and active, legally aware residents can considerably shape their governance for the better," he adds.

In Gasparian's experience, you can't put blind trust in the individuals who govern your HOA.

"Post-litigation, the majority of those I have worked with all echo the same thought: They wish they had paid more attention to exactly who was voted on to join their neighborhood's board," he says.

Unsurprisingly, how a person behaves is a good indicator of how they'll lead. "If someone is rumored to be a difficult neighbor or an individual seems to thrive off power trips, then it is best to avoid appointing them," Gasparian adds.

"Homeowners associations often believe their members are too disorganized or uninformed to dispute questionable practices," says attorney Benson Varghese, Founder of Varghese Summersett PLLC in Texas. Fortunately, technology is a great equalizer.

How does technology help in this context? 

"Analyzing monthly HOA expenses, setting up automated meeting reminders, and keeping track of correspondence can help minimize misconceptions and strengthen arguments in a dispute," Varghese explains.

It's vital to know how the rules of your HOA intersect with local property laws, per Monton.

"As a legal professional specializing in contract law and property transactions, I've advised many clients on the unintended consequences of conflicting legal obligations," he says.

That legwork can be a lifesaver, both emotionally and financially. "Ensuring that HOA rules don't infringe on your legal rights can prevent challenging and costly legal battles," Monton continues. 

Knowing the local property laws is a great way to know you are in compliance and protect your wealth. 

"I wish everyone knew the importance of understanding the enforcement processes for rules and disputes," says Monton. 

"I've witnessed situations where seemingly minor violations led to legal disputes due to strict enforcement policies." These situations can get messy for everyone involved.

Fortunately, doing your homework can keep you from being blindsided. "Knowing these processes can prepare you for potential conflicts and how they are resolved," Monton adds.

Since HOA matters can be escalated all the way into a courtroom, Greiner stresses the importance of doing your legal homework. 

"Being proactive about understanding your legal rights and the specifics of the HOA agreement can save you a lot of hassle," he says.

Having good counsel can keep issues out of court, in fact. 

"I've seen cases where early legal advice helped clients steer complex HOA disputes smoothly, ensuring they enjoyed their property without unnecessary restrictions," he adds.

It's a smart homeowner move to be well-versed in all things HOA-related, including things like deed restrictions, landscaping rules, who's on your board, and so much more. 

It's also wise to be involved in your HOA's operation.

Communal living isn't for everyone, so if you know it's not your cup of tea, stick to a standard property. But if you believe in the power of community, living with an HOA can be empowering and even enjoyable.