HOAleader.com - Tip of the Week - June 3, 2022
Published: Fri, 06/03/22
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HOAleader.com - Tip of the Week - June 3, 2022
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In this week's tip, we answer a question submitted for HOAleader's April Ask Us Anything webinar, essentially stating that their condo documents are inconsistent and out of date and asking: How do I start the amendment process?
"You really hit the nail on the head," says Molly Peacock, counsel at Rees Broome in Tysons Corner, Va., who has represented condos and HOAs for 16 years. "I think it's helpful and comforting to think: 'What is the process?' For me, this process of amendments is like eating an elephant—you do it one bite at a time."
The first step, according to several of our experts, is to step back to figure out if you really need to take this journey. "I think the process starts with identifying the true needs of the community," explains Isaiah Henry, CCAM®, CMCA®, AMS, CEO of Seabreeze Management based in Aliso Viejo, Calif., which manages about 500 associations throughout California. "Sometimes, clients say they want to amend to keep up with the current code, or a board will say that laws are changing, and they need to amend their documents.
"But it may not be necessary," he adds. "In those cases, it may not be worth the money or energy since current laws prevail anyway, whatever your documents say."
Janet Oulousian Aronson, a partner at Marcus Errico Emmer & Brooks in Braintree, Mass., who is licensed in that state, in addition to Rhode Island and New Hampshire, agrees. "This is a frequently asked question, mostly because many condo documents here are old, and people have this natural desire to update them," she explains. "I tell them to think hard about doing that.
"Yes, they may not be the most up-to-date set of documents, but the law supersedes what's in your documents anyway," she adds. "And amending them is a big process. It typically requires unit owner approval, and depending on what's being amended, maybe mortgage holder approval. And owners are always reluctant to sign off on amendments, so isn't easy."
When might amending make sense? Find out in our new article, https://www.hoaleader.com/members/4525.cfm, where you'll also get recommendations on what to budget and when to get owners involved.
Best regards,
Matt Humphrey
President
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Recent articles posted at HOAleader.com:
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The Pros and Cons of Unincorporated Condo/HOA Associations
At HOAleader.com's recent webinar on board fiduciary duties, the topic of unincorporated associations arose. Are those a thing? Is it even legal for community associations to be unincorporated? Is there a legal risk to board members if their association is unincorporated? Why would an HOA be set up this way, and should those that are unincorporated incorporate?
Click here for more:
https://www.hoaleader.com/members/Pros-Cons-Unincorporated-Condo-HOA-Associations.cfm
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Has This HOA's Last Board Member Standing Overstepped?
An HOAleader.com reader asks: "I'm in an association in Florida governed by statute 720. The governing documents specifically state, 'The Association may contract for the management of all or part of the common Properties and such other Association duties as it desires, for purposes of carrying out all or a portion of the maintenance services provided for in this Declaration...'"
Click here for more:
https://www.hoaleader.com/members/Has-This-HOAs-Last-Board-Member-Standing-Overstepped.cfm
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Can Your Condo/HOA Eliminate Quorum Requirements for Elections?
We recently saw a recommendation to California condos and HOAs to simply amend their governing documents to eliminate quorum requirements for elections. Can you do that, whether you're in California or another state? Why would you? Our experts weigh in...
Click here for more:
https://www.hoaleader.com/members/Can-Your-Condo-HOA-Eliminate-Quorum-Requirements-for-Elections.cfm
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Your Condo Can Incur Liability By Just Filling Out a Routine Form
After the Champlain Towers collapse, Fannie Mae updated its Form 1076 asking condos to provide more information about their property when units are being sold using Fannie Mae related financing. But the form essentially asks condo board members or managers to certify that the property is structurally sound...
Click here for more:
https://www.hoaleader.com/members/Your-Condo-Can-Incur-Liability-By-Just-Filling-Out-Routine-Form.cfm
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Who Fills a Seat When a Condo/HOA Board Member Not Yet Seated Resigns?
An HOAleader.com reader asks: "We just completed our yearly election. A current director running for reelection (five candidates with three winners) and won has decided to resign at the end of the current board year (FY 21-22) and therefore will not be sworn in for FY 22-23..."
Click here for more:
https://www.hoaleader.com/members/Who-Fills-Seat-When-Condo-HOA-Board-Member-Not-Yet-Seated-Resigns.cfm
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