*  Note:  The information below is an article that is general in nature and not specific to Henderson Reserve or any 

resident of Henderson Reserve.  

Advice to buyers about HOAs

By Tammy Joyner
The Atlanta Journal-Constitution
1:52 p.m. Sunday, July 11, 2010

Georgia is home to an estimated 25,000 associations, most of which are in metro Atlanta.
At the end of the day, Georgia law regarding homeownership comes down to this: Buyer beware.
“Buyers can’t assume everything is going to be fine,” said Seth Weissman, a partner at the Atlanta law firm of
Weissman Nowack Curry & Wilco. Here are some suggestions for buying a home where there is a homeowner
or condo association.
Before buying into a homeowner or condo association:
Read all legal documents (declarations and bylaws), so you know what you’re entering into contractually.
Review the HOA or condo association budget.
Try to understand thoroughly what your obligation will be. Ask how much money the association has in reserve.
If the answer is zero, that’s a red flag. Ask what percentage of owners aren’t paying. (The seller can normally
get this information for you.)
Be aware of the differences between homeowner associations and condo associations. The moment
you’re late on your condo fees, a lien can be automatically attached to your unit. Homeowner associations
generally must file liens with the court. You can also lose the privilege of paying your fees in installments if you
miss payments with some homeowner and condo associations.
Be cautious about buying a foreclosed home in an association or a subdivision where there are only a few
owners and lots of vacant lots. You and the few other owners will be stuck paying for the pool and other
expenses originally meant to be spread among a lot of owners.
If you buy
Stay current on your assessment dues. Your association can place liens against your home the moment you’re
late paying. If you owe more than $2,000, your association can foreclose on your property.
Keep records of your payments.
If you have trouble paying your dues
Tell the HOA or condo association you’re having problems. Many groups have been willing to work with
members who are facing financial problems due to job loss or illness.
Try to work out a payment plan to avoid going to court.
Seek your own legal advice. But be aware there’s not much legal recourse you may have.
When you do reach an agreement, pay the debt as quickly as possible.
By the numbers
$4 trillion
Value of homes in HOA and condo associations. That’s 20 percent of all U.S. real estate.
$41 billion
Estimated annual operating revenue for U.S. HOA and condo associations.
Source: Community Associations Institute
Find this article at:
http://www.ajc.com/news/advice-to-buyers-about-568459.html
What's the worst that can happen when you fail to pay your "condo dues?"

Short answer: the condominium association can foreclose your ownership of your condominium unit, leaving
with you nothing but legal fees and bad credit.

Section 44-3-109 provides that the assessments (often commonly called "dues" or "fees") imposed by the
condominium association to pay the common expenses of the condominium's maintenance and operation
constitute a lien against the individual units (i.e. the separately owned apartments) within the condominium.
The lien is not enforceable until the association records a claim of lien against the unit in the county real estate
records. Most associations will not take this action until you are 30 days or more past due in the payment of
your assessments. Once a claim of lien is recorded against your unit, the association can make you pay
interest on the past-due assessment, late fees, and any attorney's fees incurred in the process of collection. If
you fail to pay the past due assessment, interest, attorney's fees, etc., in full, the association may then initiate
judicial foreclosure proceeding against your unit.

Failure to pay your assessments when due is also an event of default under the standard Fannie Mae form of
mortgage (in Georgia, a deed to secure debt), which virtually every residential lender in America uses. Often,
smart association management companies will simply notify your mortgage lender of your failure to pay the
assessment. The lender in turn will send you a default letter demanding that you pay the condominium
assessment, or the lender will initiate a foreclosure of the mortgage (or security deed).

Bottom line: there is no legal excuse for not paying your condominium assessment to the association, even if
the association is failing to properly maintain the condominium's common areas. After your monthly mortgage
payment, your assessment is the second most important payment you will make each month as a
condominium unit owner. Failure to pay either will ultimately lead to foreclosure.
Kurt Raulin - The Raulin Professional Group, LLC
2000 RiverEdge Parkway, N.W.
Suite 660
Atlanta, GA 30328

How can I settle past due home owners association dues that have been turned over to an attorney
with accumulating fees
I would definitely suggest that if possible you pay the amount due as soon as possible to get the HOA
attorneys "off the clock" so to speak.
That being said, we regularly challenge HOA fees in bankruptcy court, and it is not unusual for HOAs or their
attorneys to charge fees that are not authorized by the HOA "Declarations," basically the contract with the HOA
that you are subject to. If you have a copy of the Declarations, read it carefully. Otherwise, I would request a
copy from the HOA, and you could justifiably dispute any so-called "add-on" fees that are not authorized by the
HOA's own documents.

Also, if a person or couple files Chapter 13 bankruptcy, and there is no equity in the home over and above the
mortgage, it is possible to "strip off" a HOA lien, basically turning their claim into an unsecured claim. This often
results in the HOA receiving little or nothing on its claim. Of course the homeowner must pay future HOA dues
timely as they accrue, after the year that the bankruptcy is filed. My firm is a debt relief agency and we help
people file bankruptcy.
Law Office of J. Thomas Black, PC
Homeowners' Association Assessments and Fees

Lawyers.comsm

Homeowners' associations (HOAs) have the right to impose assessments and fees on each member of the
association to pay for the HOA's operations and maintenance expenses. Assessments can be regular or
special, depending on the purpose for which they are made. Assessments are calculated, collected and
enforced in the manner required by law and as provided by the HOA's governing documents.
Regular assessments are made to defray expenses related to the ownership, operation, or furnishing of
common interests or to the enjoyment of mutual and reciprocal rights of use. For instance, the revenue
generated by regular assessments can be used for the repair and maintenance of common property, such as
lobbies, community centers, common roofs, parking lots and garages.
Special assessments are made for capital improvements or for other purposes, such as replenishing a
reserve fund that was spent on unexpected maintenance projects.
The governing documents of the development, such as the declaration of covenants, conditions and
restrictions (declaration or CC&Rs) and the bylaws, should describe the assessment process, including how
much the assessments can be increased and in what circumstances.
Regular Assessments
Regular assessments against the units in a common interest development typically must start on the date of
the first transfer of a unit from the property's developer or on the first day of the month following the first
conveyance of a unit. Homeowners don't have voting rights until the HOA has levied an assessment against
their units.
State laws provide that assessments can't exceed the amount necessary to defray the costs for which they are
levied. Regular assessments to pay the expenses of the ownership, operation, and furnishing of common
interests by the association must ordinarily be levied against each owner according to the ratio of the number
of units owned by the owner assessed to the total number of units subject to assessments. So, if an owner has
three units out of a total of 50 units, the owner will be responsible for 3/50 of the total assessment, assuming
that all units are the same size. Adjustments in the ratio can be made if an owner gets a greater benefit from
the services than other owners.
An HOA may increase the regular assessment up to a certain percentage of the prior year's assessment,
provided that the board of directors has distributed an operating budget for that year or a majority of
homeowners approves the increase. If the increase exceeds that percentage, approval by a majority of
homeowners is required.
Special Assessments
An HOA can't impose or collect a special assessment that exceeds the amount necessary for the purpose or
purposes for which it is levied.
In any fiscal year, special assessments can't exceed a certain percent of the budgeted gross expenses of the
association for that fiscal year without the approval of the majority of homeowners. There are exceptions to the
limits on special assessments in emergency situations.
Collection of Assessments
Assessments are made according to the schedule indicated in the HOA's bylaws or CC&Rs. The HOA must
send or deliver notices of each homeowner's assessment amount to the homeowner. The homeowner then
has a specified number of days in which to pay the assessment amount.
Enforcement of Assessments
Regular and special assessments are delinquent a specified number of days after they become due. If an
assessment is delinquent, the association may recover all of the following:

■ Reasonable costs incurred in collecting the delinquent assessment, including reasonable attorneys' fees
■ A late charge
■ Interest on all sums due
If a homeowner fails to pay the assessment, the HOA has several options:

■ File a civil action in small claims court (if the amount due meets the court's requirements)
■ Record a lien on the homeowner's unit or separate interest and delay foreclosure until the amount due
equals a pre-determined amount or the assessments are more than 12 months delinquent
■ Record a lien on the homeowner's separate interest and foreclose on the lien
■ Any other manner provided by law
If the HOA is going to file a lien on the homeowner's unit, at least 30 days before filing the lien, it should send
the owner of record a notice including, among other things:

■ A general description of the HOA's collection and lien enforcement procedures

■ The method of calculation of the amount due
■ A statement that if the homeowner's separate interest is placed in foreclosure because the homeowner is
behind in his or her assessments, it may be sold without court action
■ An itemized statement of the charges owed by the homeowner
■ The right to dispute the assessment debt by submitting a written request for dispute resolution to the HOA
■ The right to request alternative dispute resolution with a neutral third party before the HOA may initiate
foreclosure
To establish the lien, the HOA must record a notice of delinquent assessment in the county where the owner's
unit is located. The notice must comply with the requirements of state law. Thirty days after the lien is recorded,
it may be enforced in any manner permitted by law, including sale by the court, sale by the trustee named in
the notice of delinquent assessment, or sale by a properly substituted trustee.
Restrictions on Transfer Fees
HOAs may be prohibited by state law from imposing any assessment, penalty or fee in connection with a
transfer of title or any other interest except for an amount to cover:

■ The HOA's actual costs to change its records and

■ The reasonable cost of furnishing documents and assessment statements required by law
If you have any questions about assessments and fees made by a HOA, contact a Residential Real Estate
Lawyer in your area.