Your property’s governing documents can seem overwhelming, let us simplify them for you so you can have a better understanding of how they affect homeowners.
You just closed on your condo or townhouse. You have just signed your name and initialed what seems to be over one hundred different lines in the closing documents. You get the keys to your place, collect your packet of paperwork and notice another stack of papers you need to bring home. Those are the governing documents for your new property.
What are they for? How do they affect you? Can I just throw them in a drawer with the rest of my closing documents, never to reference them again? You could do that, but we strongly recommend against that.
Reading through and understanding how they affect you as a homeowner in an association is a very important. You will have a better understanding of rules and what maintenance items are the responsibility of the homeowners versus what the association covers.
The declaration is by far the most important document for an association. It may be referenced as the master deed or CC&R’s (covenants, conditions, and restrictions). In political terms, it can be compared to the constitution for any given property.
While the contents inside of the document may be complicated, it purpose is not. Simply put, the declaration explains an owner’s obligations to the association. It will discuss topics such as:
- Payments, including dues and assessments
- Minimum maintenance and upkeep
- What the association expects and requires from its owners
- Rules that owners need to follow
It is typically the largest document and can be the most intimidating of all the property’s governing documents. Take your time and read through it and you will understand your rights and responsibilities.
Over time, associations will find situations where provisions are confusing, conflicting with other documents and they do not reflect the current environment of the property. It is not as simple as updating a document in word, it is a drawn out legal process that requires a certain percentage of votes from the community. Organization, education, and working with an attorney to properly draft verbiage, and having newly amended documents recorded with your local county are proper steps in updating property governing documents.
The bylaws are guidelines for how the association should operate. Examples of guidelines include
- Board member’s term length
- Voting percentages needed to approve or disapprove amendments
- Notice requirements
- Board meeting procedures
- Election procedures for board members
- Roles and authorities of board and committee members
Articles of Incorporation
The articles of incorporation outline the governance of a corporation in the state where articles are filed. They include the legal name of the corporation and type of corporate structure (HOA’s are a not-for-profit corporation).
Rules and Regulations
The rules and regulations are a document that provide additional policies that are separate of both the declaration or bylaws. These are rules regarding property matters such as parking, landscaping, or other common elements and areas. They help clarify issues that are not clearly defined enough in the declaration or bylaws. This is an opportunity for properties to clearly refine their collections, fine, and assessment policies as well.
The plat map is a drawing of the layout of a property. It shows the location and dimension of lots for townhouses, units for condos as well as the common areas of the property. Additionally, location of easements and sometimes notes with regard to ownership and maintenance can be included on a plat.
Understanding the Hierarchy
Association governing documents don’t have to be intimidating and confusing. If you have a question in regards maintenance responsibility you can check out the declarations. If you want to better understand how your property’s board of director’s vote, you know to check out the bylaws.
Having an understanding will help provide education on any issue between neighboring units, board members and the property’s management company. Now when you pick up each document you will be aware of how each document affects the property as well as each unit owner in an association.