From Capitol Hill/Legislation

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Recently, I wrote an article that was published in the October 2011 edition of the CAI Rocky Mountain Chapter’s Common Interests magazine. Colorado HOAs: At a Legislative and Regulatory Crossroads focuses on the evolution of legislation in Colorado beginning with passage of Senate Bill 100 back in 2005 through the 2011 legislative session. 

In my opinion, based upon the legislative trends in Colorado and the anticipated report from the Division of Real Estate which will be published in December summarizing complaints received about HOAs, there is no question we are at a legislative and regulatory crossroads in Colorado. Lawyers like me can pontificate on what we expect to see during the 2012 legislative session. However, the fact is that not one of us has a crystal ball. Instead, we will have to wait and see what the legislative and regulatory fall out will be from the Division’s report. In addition, there’s little doubt that HOAs will be a legislative focus in what promises to be a highly charged session rife with election year politics.

 Continue Reading Anticipating the 2012 Legislative Session for HOAs

According to Community Associations Institute ("CAI"), the Federal Housing Administration is evidently backing off a new requirement that management companies carry a fidelity bond on any condominium association they manage that would cover an amount equal to the association’s budget and reserves.  Here is what CAI is reporting: 

"Thanks to pressure from CAI members across the country, the Federal Housing Administration (FHA) indicated that it will revise a controversial regulatory mandate that would require management companies to carry a fidelity bond if they managed a condominium association. In June, FHA released new guidelines for its condominium mortgage insurance program. The guidelines set standards that condominium associations must meet in order for any potential buyer to qualify for a FHA-backed mortgage. As FHA accounts for nearly one in three condominium mortgages, the guidelines have a significant impact on the marketability of condominiums.

 Continue Reading CAI Reports FHA Backing Away From Management Company Insurance Mandate

I just returned from an excellent training provided by the U.S. Department of Housing and Urban Development (“HUD”) on the new and revised requirements for FHA condominium project approval found in the Condominium Project Approval and Processing Guide.

The 800 pound guerilla in the room was the new Project Certification requirement. Beginning on August 31, 2011, any application for a new certification or recertification submitted to HUD for FHA approval requires the condominium association, or an agent of the association, to sign the Project Certification which says the following:Continue Reading HUD Commits to Revisit Provisions of the FHA Project Certification

 Here’s an update from CAI National on CAI’s lobbying efforts relating to FHA’s role in establishing criteria for condominium associations to become approved for FHA-backed loans: 

"The House Financial Services Committee’s Subcommittee on Insurance, Housing and Community Opportunity hosted a hearing on September 8, examining the role of FHA in the mortgage markets. Acting FHA …

On Wednesday, the Colorado Division of Real Estate distributed the following communication relating to HOA Registrations: 

“One of the purposes of HOA registration is to provide the Colorado consumers with basic information about HOA’s, including their physical address and contact information for the HOA. It is important to remember that when you register your HOA…

Back in May, Lindsay Smith blogged on a story involving a couple in Louisiana who were displaying a banner in their yard supporting their son who is a Marine serving in Afghanistan. 

Timothy and Jodi Burr, the proud parents of the Marine, claim that a covenant of Gardens of Southgate Homeowners Association (“Association”) prohibits the placement of signs on lawns within public view. They also maintain that the Association is selectively enforcing this covenant since the Association has allegedly not taken enforcement action on “numerous signs throughout the neighborhood.” 

 

Since May, this story seems to have taken on a life of its own and has become extremely ugly. Evidently, the couple did not take down their banner and the Association has filed a lawsuit against them to force compliance. In addition to the issue of selective enforcement, the couple has contended that the Association has been unresponsive to their requests for a meeting to discuss this issue. Continue Reading Do HOAs Need to Rethink Prohibitions on Displays Supporting Members of the Military?

This week I have been blogging on recent changes made by HUD to the FHA guidelines which condominium associations must comply with to become FHA-certified. This certification is important since it enables purchasers of units in these associations to be eligible for FHA-backed loans which enhances the marketability of units.

Beneficial changes have been made in the Condominium Project Approval and Processing Guide (“Guide”) relating to the percentage of commercial space which may be present in a condominium project and the percentage of assessment delinquencies an association may have to be eligible for FHA-certification. Here’s what you need to know:Continue Reading Positive Changes to FHA Guidelines on Commercial Space & Assessment Delinquencies

As I discussed fully in a blog posting on March 21, 2011, for a condominium association to obtain HUD certification for purchasers of units in that association to obtain FHA-backed loans, one of the requirements is that at least 50% of the units in the project must be owner-occupied. Simply put, that means associations must have a mechanism to regulate the rental of units. Ironically, HUD also had in place guidance that would have disqualified any association with rental restrictions in the association’s governing documents.Continue Reading HUD Approval of Some Leasing Restrictions Made Permanent

If you serve on the board of directors or are a manager of a condominium association, you know that obtaining approval from HUD for FHA-backed loans really enhances the ability of owners to sell their units in your community. 

As I mentioned in myJune 30th blog posting, HUD launched the new Condominium Project Approval and Processing Guide (“Guide”) which outlines the criteria that condo associations must comply with in order for these communities to be certified by HUD to be eligible for purchasers of units to obtain FHA-backed loans. One of the many items that HUD reviews when analyzing an association’s submission, is whether the association has levied a special assessment. Here is the provision of the Guide that addresses special assessments: Continue Reading Special Assessments Proving Problematic for FHA Approval

On June 30th, we announced in a blog posting that the U.S. Department of Housing and Urban Development (“HUD”) had just released the new Condominium Project Approval and Processing Guide (“Guide”). The Guide consolidates the processes and requirements that condominium associations must comply with in order to receive FHA certification. In addition, the Guide also…