You might consider communities that are members of a homeowners association (HOA) when you’re looking for a house.

These associations oversee the upkeep, appearance and maintenance of private communities such as condominiums and suburban neighborhoods. The state regulates HOAs.

HOA membership usually involves regular dues or fees. HOA fees are used to maintain the common areas of the property as well as provide some amenities for members.

HOA fees can be an additional expense to your mortgage and you might wonder if it’s worth it. It’s crucial to learn how HOA fees work and what rules and regulations you will need to follow as a member before you purchase a new house.

Why does HOAs exist?

A homeowners association (or HOA) is an organization that exists to preserve a community, neighborhood, or development for its residents. The HOA will often charge a fee to maintain the community or add amenities.

Bylaws and rules that govern property owners may be included in HOA agreements. Before you buy a home in a planned neighborhood, it is a good idea that you review the rules of your HOA.

It is important to realize that HOA communities are not governed by a national standard. You may not find an HOA in your neighborhood, but you might be required to pay HOA fees.

What is a HOA fee and how does it work?

If you reside in a condo, townhouse, or planned development, homeowners association fees might apply. These fees are charged to homeowners to maintain their neighborhood or property. They can be collected monthly or annually.

The bottom line is that HOA fees are designed to ensure homeowners retain the property’s value.

What are the HOA fees?

Although there are not national standards for HOA fees they can often be between $200-300 per month.

These fees are an additional cost to your monthly mortgage payment. You’ll want to consider HOA fees when you buy a house.

What are HOA fees?

HOA fees typically cover two things. One, the monthly expenses required to maintain the agreed-upon areas in a building or neighbourhood — and the reserve fund.

You can add items such as:

  • Pool maintenance
  • Landscaping
  • Services and security cameras
  • Services such as water, sewerage and trash collection are provided by the city.

This reserve fund is typically used to save for special projects such as new pools or playground equipment. You can also use this fund to make repairs in case of vandalism, natural disasters, or other emergencies.

What happens to my HOA fees if I don’t follow the HOA rules and/or pay them?

Your HOA membership includes certain bylaws or “covenants” that must be followed. These rules are set forth by state law and will require members to pay monthly or annual dues. These bylaws and “covenants” also include rules and procedures that govern HOA meetings and elections.

Covenants can include guidelines for how residents should take care of their property. These covenants may also contain guidelines about renting out your property and how many people you allow to live in your home.

What happens to your HOA fees if you fail to pay them?

You could face severe consequences if you don’t pay your HOA dues. You will receive several letters from your HOA demanding payment. If they don’t, you could lose access to certain amenities.

If you don’t pay your HOA dues on time, the HOA could file a lien against your property. This means that you cannot sell your home until your HOA dues are paid. They may even try to foreclose on your house in extreme cases.

What happens to you if your HOA rules aren’t followed?

Sometimes homeowners might be tempted not to follow certain HOA rules in the hope that the HOA won’t notice or take action. If you do break the rules, your HOA might take action to enforce them.

  • For violating the bylaw, a fine could be issued
  • You may be denied access to certain facilities, such as the pool and fitness center.
  • Place a lien on the property
  • For violating the bylaw, you could be sued

What’s next?

It is important to ensure that you are able to afford your HOA fees before you purchase a home. This will prevent you from being late or defaulting. HOA fees are an additional cost to your monthly mortgage payment. You want to make sure you have the funds you need.

Consider saving money throughout the year for HOA fees if they are due annually. This will ensure that you don’t get caught unawares when your annual HOA fees become due. You can contact your HOA to discuss a payment plan if you fall behind in your HOA fees.