Today in the Denver Post, an opinion was published by Jose’ Martinez entitled The dark side of HOAs. While there is no question that not every HOA is perfect, it’s unfortunate that Mr. Martinez made the leap that based upon an anecdotal situation he observed –  all HOA boards and management companies are bad…

After a wonderful holiday weekend, it’s time to saddle up and get back to work! For management and boards of homeowners’ associations (“HOAs”), that means budget season is now in full swing. While community association managers play a pivotal role in assisting boards with the creation of budgets, it’s ultimately up to each board to adopt a budget that’s in the best interests of the association they serve. That means boards must be fiscally responsible when creating their budgets. 

Over the past few years, boards have understandably been reticent to do anything to increase assessments. For some HOAs, especially some condominium associations, that has meant making a decision to defer routine maintenance and to either not fund reserves at all or to fund them at a low level. While kicking the reserve can down the road may seem like a short term solution to an assessment increase, if put off too long, this can become a recipe for a fiscal nightmare. 

 

When facing the question of whether – or at what level – to fund reserves, boards should ask themselves the following questions:Continue Reading Budget Season: How is your HOA handling reserves?

FHA officials have informed CAI National that they anticipate revisions to the condominium guidelines will be released this week.  However, based upon this communication, CAI is not convinced these changes will be sweeping or substantive in nature.  For more information from CAI National, check out FHA Signals Release of New Condominium Guidelines.  And as always, you can count…

In an effort to stem losses from foreclosures, Fannie Mae and Freddie Mac have just announced a policy change addressing short sales.  CAI National released the following update outlining these changes.

“Fannie Mae and Freddie Mac have announced changes to short sale policies to help more borrowers avoid foreclosure and stabilize neighborhoods. Mortgage servicing companies will begin using the new short sale procedures in early November.

A short sale allows a homeowner to sell their home for an amount less than the value of the existing mortgage. While Fannie Mae and Freddie Mac incur losses in a short sale, these losses are significantly lower than the costs of foreclosure. As a result, the short sale is quickly becoming a preferred foreclosure alternative for both Fannie Mae and Freddie Mac. Continue Reading Fannie Mae and Freddie Mac Change Short Sale Requirements

CAI National recently released the following communication addressing plans by the U.S. Government to shrink Fannie Mae and Freddie Mac.  It is currently unknown whether, or to what extent, this course of action will impact the financing of mortgages in community associations.Continue Reading U.S. Government Announces Plans to Shrink Fannie Mae & Freddie Mac

Mediation is a type of alternative dispute resolution with the goal of finding a solution and reaching an agreement that is acceptable to all parties involved. In some counties, mediation is mandatory and if a case becomes contested, the parties are ordered to attend mediation prior to scheduling a trial. In some instances, however, even if not court ordered, it may be beneficial for the parties to attend mediation depending on the facts of the case.Continue Reading What is Mediation?

As I was driving to work this morning, I was reflecting on some of the less than constructive communications I have witnessed in the community association context lately. I don’t know if it’s the heat that’s getting to everyone or if the ugly presidential campaign is starting to rub off on us, but it seems like some folks have lost the ability to be constructive and to think before they act or speak. 

Whether it’s a homeowner to homeowner dispute, homeowner to board dispute, board to homeowner dispute, homeowner to manager dispute or any other combination – everyone needs to take a deep breath and think before they act. It’s also a good rule of thumb not to blast off that nasti-gram or leave a blistering voicemail in the heat of the moment. Continue Reading You Catch More Flies With Honey

After the shooting of Travon Martin in February, association lawyers discussed the possibility that the Retreat at Twin Lakes Homeowners Association could face liability for the actions of George Zimmerman, a member of the HOA’s neighborhood watch.

It appears that Martin’s family will be making a claim against the HOA’s insurance policy, asserting they are owed at least $75,000.00.  This indicates the Martins may intend to file a federal court suit against the insurance company.  The policy’s limit is $1,000,000.00, but the big issues will be whether the policy provided coverage at the time of the shooting, and whether it covers the shooting at all.Continue Reading After a Tragedy, the Inevitable Search for Deep Pockets

Yesterday, the Denver Post ran a story entitled Rebuilding to test covenants after Colorado Springs wildfire. The story focuses on the Mountain Shadows Community Association which was devastated by the Waldo Canyon fire. The Post reports that 346 homes were destroyed in this community made up of custom homes, patio homes, condos and townhouses. 

While the ashes of this devastating fire have barely cooled and the broken hearts of the residents cannot possibly have healed, the story anticipates fighting over rebuilding and the inability of architectural review committees “to enforce the covenants and rein in rebellious property owners.” The story essentially focuses on ways to control homeowners as they attempt to rebuild their homes and their lives.

 

Unfortunately, the story misses the most important point – this is the perfect opportunity for the homeowners in Mountain Shadows to come together to build consensus on a vision for the community they would like to rebuild. With the exception of being required to comply with applicable local, state, and federal laws and ordinances, governing documents of HOAs can (and should) be updated to fit the priorities of the owners in the communities the documents govern.  Here are some thoughts for the folks at Mountain Shadows, and any other HOA for that matter, facing the task of rebuilding:Continue Reading Colorado Springs HOA Has Unique Opportunity to Build Consensus and Community

 Last month I explained the basics of an association judicial foreclosure through the time of the sheriff’s sale.  In an ideal world, all foreclosures would result in a complete monetary recovery for an association and a new owner would timely pay all future assessment charges.

 However, it is not uncommon for an association to take title to a property through its foreclosure sale. This is especially likely to occur if the property has a first Deed of Trust (mortgage) and/or tax liens which exceed the market value of the foreclosed property.  So what should an association do once it takes title to a foreclosed property?

Continue Reading What to Expect Following an Association Foreclosure Sale