HOA doing something illegal?

19 Replies

Quick question on HOA's. I live in Missouri and I have a small HOA on my primary residence. My subdivision has no pool, no neighborhood watch, there is really nothing or any reason for the HOA. Its because of this I reached out to them to get a financial statement to see what they actually do and why I am paying for this. When i asked them for the info I couldn't get a response. I then reached out to some other people in the neighborhood and they said that they also had reached out to them regarding the financial statement. They said the HOA responded with half the neighborhood doesn't pay the fees so there is no reason to send it. We just collect the fees when the go to sell.

I'm sure you can see that this seems a bit fishy to me. I am wondering what rights do we have? Can we force them to send us the required information without spending a lot of money on an attorney? If they aren't doing anything how do you disband the HOA?

Thanks,

Scott

@Scott Houin Depends. What does the hoa by laws say? You should be able to get a copy of it. I simple letter from an attorney should get you what you want. Normally there is some type of community work being done. Common areas, playgrounds, or even the pretty entrance into the neighborhood. Who’s the president? Is it self managed by the neighborhood or is there a company?

I will have to call and see if they can send me the by laws. I was trying to avoid an attorney as it would cost me $500 to get them to write a letter the HOA is only $75/year. I think that might be an issue its so little nobody really cares that much.

The only community area we have is the sign coming into the neighborhood.  There is no playground or other common areas.  

I will see if i can get information on who the president is.  It's managed by a company.  

Stop paying and see what happens, if others aren't paying why should you? But I don't like HOAs to begin with, I'd be a thorn in their side if they weren't doing anything as you stated above. 

@Scott Houin   There may be other non-obvious things they're doing, like common area maintenance, landscaping, road or parking area repairs/striping/paving or paying for insurance for the common areas.

You might also look at what it takes to serve on their board.

We have several $75/yr HOA's up here on the lake. The roads are not part of the town so they have to be plowed and filled in when there is a pothole. They are really loose, have no meetings. Basically Fred has been plowing for 30 years for the same fee, Janice has kept the entrance sign taken care of, Jeff keeps the grass cut along the entrance. The common boat ramp gets yearly maintenance by Tony.

Because it is not town roads alot of the taxes are alleviated. I most likely would not bother worrying about it and just pay it, especially since I am guessing you agreed upon move in. Bringing notice could just raise awareness and get a bunch of people deciding they want to be part of it and all of a sudden you have a real HOA you are paying $55 a month.... then $58 when they pass some other thing and then $62... The people with the most time on their hands will start to dream up all sorts of rules and people at meetings will vote (So 6 people will decide for all). I'd throw them the $75 and forget about it for a year myself (but that is just me)

@Mike Cumbie

My main concern isn't paying the fee, but finding out what they do. My home is located in the city and the roads are maintained by the city. Even the park next to me is maintained by the city and is a city park. I'm going to double check, but i don't remember ever getting anything regarding an HOA when I bought the home. I didn't even know we had one one until i got my first bill a year later. My neighborhood is pretty large 100+ homes and if they are receiving 7k per year, but only maintaining 1 sign in front of the neighborhood or mowing a few feet of grass don't you think it would be worth using that money towards some good?

I get what your saying that raising awareness could hurt, but I also don't think a management company should just pocket 7k a year for planting some flowers because of fear that raising awareness might cost me more.  I guess time will tell. 

Thanks for your input.  

I would think if you pay HOA dues you have a right to review the records.

Maybe everything is on the up and up.

Maybe the HOA is run by Fat Tony, Don't ever ask me about my business. :/

@Scott Houin you should be able to get a budget no problem. As realtors and wholesale I get these no questions ask. Within the budget it will detail what there expenses are: Admin Maintenance Reserve Etc The reserve will have how much money the HOA has saved up. For most party if they have no reserve then they impose special assessments on the owners for when they want to pay for added expenses like paving the street, and other common areas. If you are calling my best advice is to show up and request a copy of the budget. If they don’t have an office in site and someone managed off site, then make sure you hound them by email, phone, even fax.

Be careful, we have a lot of hoa's here in Las Vegas & they can actually foreclose on a home after lack of certain payments. I actually have a friend who is an HOA attorney.. And yes it would cost hundreds for an hour of his time. Maybe have a few of the other concerned citizens pool their money to hire one? That way the cost is less per home and if there is anything fishy, the attorney could class action collect, which they love doing. On the flip side, what others have been saying about less obvious costs for maintenance could well be the case. Either way good to you whatever you decide.

I agree with @Mike Cumbie here.  I'd just pay it and glance around common areas and entrances when I pass through them. If something expensive needs repaired and it gets ignored then ***** to high heaven about "Where all the money goes cause I actually pay it". 

I wouldn't crack the lid off that can of worms for fear I'd never be able to get it back on...cause humans suck.

I have one HOA whose only real job is to police the neighborhood to make sure my neighbors don’t allow crap to fall into disrepair or otherwise let their visible areas to look like crap. That’s it. I pay it because it keeps the neighborhood from losing value.
@Scott Houin There are mandatory hoas and non mandatory. The mandatory probably have to file with the county clerk. They also have the right to foreclose for non payment...pretty important . Sending a bill and not a “please join” letter explaining why you should voluntarily join sounds 1) mandatory or 2) shady if not legally a mandatory hoa. (For all you know the developer’s best buddy set it up and is pocketing all the money.) My voluntary hoa pays 1k per year to provide eo insurance for the hoa president. I guess he feels he needs it but... I feel it would be a waste of my money. Is there an “association of hoas” in your state? They are pretty big business and some states have them because I have seen a sign before.

Get a copy of the HOA rules, you should definatly have asked for that when you purchased, read them relax and let it go. Standing on principals is a total waste of time and energy. $75 is nothing in the bigger picture.

A few notes from my skimming. $7k per year for 100+ homes is almost nothing $6/month?

The following are Nevada specific your laws may differ. 

1) when you buy an Hoa property you must be given the bylaws you must be given a current financial statement you must agree within 3 days that you will abide by those bylaws. (Search for the newest buyer in your neighborhood or any homes for sale?)

2) every year you will be provided with a yearly summary of income and expenses. (Run for the Hoa board and get first hand knowledge?)

Your mileage certainyl may vary with such a small Hoa fee. Here a cheap Hoa is $39/mo times 100 homes is almost $50k per year. And that’s for an Hoa that has one or two unlit neighborhood signs and all public streets. All that money buys you is the right to be hassled by the inspection nazis and threatened with more fines for extreme violations like trash cans being visible from the street, leaking sprinkler system, oil stains in driveway or a burnt out light. 

My daughter just bought in a neighborhood with a voluntary HOA of $75 or so a year. She was curious so they went to a meeting.

The HOA funds the flowers, etc. Minor stuff. The $75 seemed to go into a petty cash fund that they used to help the neighbors. They also arranged to hire someone to mow for an elderly couple where the husband was recovering from a heart attack; they organized volunteers and used funds to buy paint for the exterior trim of a couple out of work. There was also a small prize for the best landscaping of the month kind of thing.

Only way you're going to know is to go to a meeting.

Read somewhere that there is some dude in KC, just picking a neighborhood and sending out HOA invoices, but that there is no actual HOA, so make sure it is a real HOA.

Unless they have officially formed and have docs filed forming the HOA, it may be bogus.

Your local title company should be able to look that up to see if it's a real HOA or if they are making it up.

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