HOAleader.com - Tip of the Week - February 25, 2011
Published: Thu, 02/17/11
=================================================================
Is Your HOA Board of Directors Considering a Ban on Reverse
Mortgages? Think Twice
=================================================================
In this week's tip, we provide critical information for any
homeowners association board worried about owners' reverse
mortgages. Many suspect a reverse mortgage may be a sign a
homeowner is in--or about to enter--rough financial waters.
Because a reverse mortgage is just another form of mortgage, the
question is whether you can restrict owners' right to mortgage
their property, whether that mortgage takes the form of a
traditional mortgage or a reverse mortgage. Though it's rare,
home owner associations can restrict mortgages on owners' units.
"You can put something in your documents to that effect," says
Steve Daniels, coordinating partner of Arnstein & Lehr's West
Palm Beach, Fla., office, who has advised hundreds of HOAs.
"There are quite a few properties in Palm Beach that don't allow
you to get mortgages at all unless you get approval from the
association."
However, such restrictions would need to be in your HOA governing
documents and would even then be scrutinized closely. A ban on
reverse mortgages would essentially be a restriction on owners'
right to sell or transfer their interest in their property, which
in the law is called a restraint on alienation. "A lot of states
have a restriction on restraints on alienation unless those
restrictions are written in the association's master deed or the
declaration, or the bylaws in states where those are recorded so
there would be notice to future buyers," explains Elizabeth White,
a shareholder and head of the community associations practice at
the law firm of LeClairRyan in Williamsburg, Va. "So you wouldn't
be able to legislate a restriction on reverse mortgages through
your rules or regulations because it's a restraint on alienation.
That's a fundamental right of property ownership, and when you go
to restrict it, there will be a much, much higher level of
scrutiny."
Do reverse mortgages interfere with your association's ability to
protect its lien rights? Do they indicate that owners are in or
heading toward financial distress? For answers to these questions,
see our new article, Reverse Mortgages: What HOAs Should Know
http://www.hoaleader.com/members/548.cfm
Best regards,
Matt Humphrey
President
=================================================================
Free Group Membership Upgrade
HOAleader.com members can now get a free upgrade to group
membership.
With a group membership, the rest of your HOA or condo board--up
to 9 additional members--will get their own member accounts.
It's a fantastic value.
Make your job easier. Help the rest of your board get up to speed
on HOA management best practices by adding them to your HOAleader.
com membership today for no cost.
Already a member? Create complimentary accounts for the other
members of your HOA board now:
http://www.hoaleader.com/members/main.cfm
Not a member yet? Sign up now with our low individual rates and
then add your fellow board members for no additional cost:
http://www.hoaleader.com/details.cfm
=================================================================
Recent articles posted at HOAleader.com:
================================================================
HOA Board to Manager: No, Thanks. We've Got This.
One problem: a homeowners association board of directors that can'
t bring themselves to delegate responsibilities to their manager.
A bigger problem: HOA board members who over-delegate. This week'
s tip highlights three duties your board should never cede to
your HOA manager.
Click here to read full article:
< http://www.hoaleader.com/public/541.cfm >
================================================================
Why Your HOA Board--Not Your Manager--Must Authorize Liens
Who should initiate the process of filing a lien on an owner's
unit? That's the question of one HOAleader.com reader, who says
her HOA board of directors seems to be allowing managers to set
lien processes in motion. She wonders if that's a decision that
should be reserved for the board. Here our experts explain why
the board shouldn't give its HOA manager carte blanch to file
liens against homeowners.
Click here to read full article:
< http://www.hoaleader.com/members/540.cfm >
================================================================
9 Responsibilities HOA Boards Shouldn't Delegate to Their Manager
HOA management companies can be a great help to an association's
board of directors. But a manager is not supposed to usurp the
board's duties. Here we share nine duties you shouldn't allow
your HOA manager to handle.
Click here to read full article:
< http://www.hoaleader.com/members/539.cfm >
================================================================
HOA Use Restrictions: What's Common, and What's Improper?
Some HOA governing documents limit the use of owners' units
through use restrictions. One example: Limiting the number of
overnight guests to 30 a year. Are such rules permissible? Are
they even enforceable? Here we discuss a few common use
restrictions, their pros and cons, and better ways to skin the
cat.
Click here to read full article:
< http://www.hoaleader.com/members/538.cfm >
================================================================
State HOA Registration Requirements--What You Should Know
Some states require HOAs to register with the state, and if your
homeowners association fails to do so, it could lose certain
rights. Could you even lose your lien rights and the ability to
enforce recorded covenants? Here's a lowdown on state
registration requirements and an answer to that all-important
question.
Click here to read full article:
< http://www.hoaleader.com/members/537.cfm >
=================================================================
Get your own copy!
Subscribe to the HOAleader.com Tip of the Week at:
http://www.hoaleader.com/public/department49.cfm
=================================================================
Please feel free to forward the *entire text* of this email to
others.
Copyright 2011, Plain-English Media, LLC
(866) 641-4548
http://www.hoaleader.com