Four Powers That Your HOA Doesn't Have

Posted on: 27 January 2017

Homeowner's Association can seem all-powerful -- especially when you've just purchased a home or moved into a neighborhood. But there are certain things that an HOA cannot do and you need to be aware of your rights. Many HOAs do not work directly with legal counsel for their day-to-day operations, so it will be up to you to enforce these rights.

1. HOAs Can't Discriminate Against Protected Classes

HOAs cannot make rules or regulations that discriminate against protected classes. This is true even if the by-laws for the homeowner's association have these rules or regulations within them. This is because you cannot agree to a contract that will take away the rights that you have as a citizen. Note that discrimination by an HOA might not be immediately visible. An HOA could potentially be targeting those of a different race, for instance, for citations. A homeowner would need to prove this in order for discrimination to be shown.

2. HOAs Cannot Change Existing Contracts

An HOA can unilaterally decide that a condominium will no longer allow pets. This is a right that the HOA has. However, that doesn't mean that the HOA can demand that owners get rid of existing pets. The former contracts that the condo owners previously signed will still hold true, so former owners will still be grandfathered in and will be able to keep their existing pets. It is new owners that will need to adhere to the new contracts.

3. HOAs Can't Control Rental Applications

It used to be that a very strict HOA may require that they control all rental applications. Rental applicants would need to work directly with the HOA before they could be approved. HOAs are no longer allowed to do this -- and they really shouldn't take on the liability, regardless, because that can again lead to discrimination issues. If you want to rent out your home or condo eventually, do keep in mind that HOAs may still have limitations on rentals themselves.

4. HOAs Can't Require Credit Reports

Finally, an HOA cannot require a credit report from an owner or tenant for any reason. HOAs, in the past, have been tempted to collect consumer reports, credit reports, and background checks, all in order to keep their communities exclusive. This is no longer allowed, as housing itself is not to be entwined with credit.

An HOA is not the enemy. Homeowners associations almost universally improve property values by ensuring the condition and consistency of a neighborhood. But if you do find yourself fighting with your HOA, you should be aware that there are things out of their control.


Saving Money On Real Estate

After I got promoted at work, I realized that there were a few things I wanted to do with all of the extra money. One of the biggest goals that I had was investing in local real estate, because I wanted to experience what it would be like to own multiple properties. It was really overwhelming at first to put in the offers, but after awhile I got really good at saving money on real estate and seeing the rewards. This blog is all about knowing which properties to invest in and focusing more carefully on the art of getting a great deal.