Home Owner Assoication Non-Profit never filed

Started by CindyP • 8 replies • 1468 views

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CindyP (South Carolina)
Posts: 3

Posted:

WE recently discovered our HOA is not officially set up and paperwork and $200.00 fee has not been done by the developer. The Developer is in charge and is working under LLC, but we are paying assessments for the past three years. There are problems here and common maintenance areas are not kept and a lot of things are just not done. The fact the HOA has not been filed - What does this mean for us as homeowners? What should we do?

Thanks
Cindy

MelissaP1 (Alabama)
Posts: 13,836

Posted:

It sounds like the developer hasn't turned over the HOA to the residents/owners yet. If the developer is still in control, you don't have a HOA yet. You STILL have to pay, it's just NOT under the homeowner's control.
HOA stands for HOMEOWNER's ASSOCIATION. That means the HOMEOWNERS are "associated" with eachother to make and live by the rules the homeowner's want. Simply put, if your developer is still in control, you don't have an HOA officially.
I would find out what it takes to get the developer out of control. Are all the lots sold yet and the amenities promised put in yet? The developer will eventually turn the property over to the homeowner once they decide and meet the criteria to do so. Developer typically want out of running a HOA once they sell their lots. The developer should assign the FIRST board when the transition begins. After that board finishes it's term and the developer is gone, the homeowners can then start contolling and voting things themselves.
This could take a few years for the complete transition. As for the money not being spent on the items you feel need it, it's up to the developer where to spend the funds until they leave.

Former HOA President

CindyP (South Carolina)
Posts: 3

Posted:

Thanks Melissa for your reply and we spoke with the Developer and he is going to allow us to set up a Pool Committee and Issues comittee to define the issues we are having and hopefully this will be an approach with a more positive outcome than 40 families calling him and complaining.

We have to be 2/3 full before we can take over the HOA- this is around 140 home development and we have 40 homes and several lots sold waiting for their current homes to sell and 6 - 7 homes under construction

It looks like it may be a while. We will see how it goes with the committees.

Thanks,
Cindy P

RogerB (Colorado)
Posts: 5,067

Posted:

Cindy, in Colorado the association is set up when the Declaration is filed. Even during the period when the Developer controls the Board the association exists. Perhaps you and Melissa are confusing this with filing as a nonprofit corporation or establishing By-laws.

CindyP (South Carolina)
Posts: 3

Posted:

Roger,

I think you are right We have a declaration of covenants, but what we do not have is the HOA, Inc. as a Non-Profit. Do you know if there is a reason a developer would not want to get this done or if it only has to be done before the HOA is transitioned to the home owners with a Board of Directors?

Thanks
cp

RogerB (Colorado)
Posts: 5,067

Posted:

Quote:

Posted By CindyP on 05/07/2007 5:25 PM
Do you know if there is a reason a developer would not want to get this done or if it only has to be done before the HOA is transitioned to the home owners with a Board of Directors? Thanks cp

Ignorance? Stupidity? Forgetfulness? Who knows why? It can easily be done at little cost.

ChristopherW (Utah)
Posts: 1

Posted:

Hi I am new to this website and a fairly new condo owner. I have lots of questions. We have had meetings to do away with the current management firm we have and during this meeting we talked about the stairs in front of the building needing to be replaced. This is going to cost every owner 6 or 7 hundred dollars. We have quite a few one parent families in here that can not afford this. So our only option is to raise rates and save for it so we can get it done in a year or so. During this conversation the President stated that she called a bank and they would not give us a loan because we are not a LLC or corporation. I have started one business of my own and helped two friends start one so I know how to do this. I volunteered to find out more information. If we were to start an LLC this might help us with large expenditures in the future because we could at that point be loaned the funds needed. Is this common for HOA's to be non-profit corporations? If so would we be taxed the same as we are now? Is there a special kind of corporation set aside just for HOA's? Can someone help?

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Christopher,
First, find out what you have on record as an association. Go to mlocal Court House and copy all records on file. Then check your state laws and see what is required. Go to another condo in your area and see what they have on file. Then post again here under a separate heading.

RobertR1 (South Carolina)
Posts: 5,164

Posted:

CindyP,
What general area in SC?
Go to State web site and search Horizontal Property Regime.
Get that document and build on that. Are you registered in the state as a corporation? If possible go to another association close by and see what you can find out. SC is not the easiest state to get good information from. Go to court house and search any property records under your name. You can also do this on line at your county web site. Search this site "search" feature for topics you want to know about. Don't change anything until you know what you are doing. Come back here and post specific questions. Do not sign any papers with developer until you are comfortable with your knowledge. Set up a transition team to deal with developer and if any DOUBT, hire a good HOA Lawyer but don't sign up for long term.
Get answers to specific questions here. You are in a tough spot so be cool and smart.

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