Florida homeowners are no strangers to Homeowners Associations, but what are they exactly and how do they affect your ability to get pre-approved for a Florida home?
Homeowners associations (HOA) are legal corporations formed by a real estate developer to market, manage, and sell homes and lots in a residential subdivision.
They’re most commonly formed for condominiums and planned urban developments (PUDs); very common for Florida homeowners.
An HOA’s Articles of Incorporation typically grant developers privileged voting rights in governing the association during its infancy, while providing the means for the developer to exit financial and legal responsibility for the organization, transferring ownership to the homeowners of the association.
This transfer typically occurs after a predetermined number of units have been sold — often two-thirds of the available lots and/or units.
Each homeowners association enforces its own governing documents in the form of restrictive covenants, by-laws, architectural guidelines and regulations. Together, the “rules” of an HOA are meant to define the community standards for the purpose of protecting property values.
Restrictive covenants vary widely from homeowners association to homeowners association. Covenants may include guidelines on issues as varied as where parking is permissible; planned architectural improvements; and, landscaping.
HOAs in Orlando often enforce these common restrictive covenants, among others :
Boats, utility trailers, RVs, and commercial vehicles may not be parked in driveways and streets
Homes may not be painted in “loud” colors
Yard signage may not be political in nature, nor defamatory
Lawn care must be performed routinely to prevent overgrowth
For Florida condos with balconies, towels and clothing may not be draped on railing
For homes governed by an HOA, membership in the homeowners association is a condition of purchase and buyers are not permitted to opt-out.
Homeowners associations make their by-laws available upon request to existing, governed homeowners and will often make by-laws available to prospective Florida home buyers as well. Review community guidelines before buying into a building or neighborhood, and before beginning a home improvement project. It’s important to know what actions are permissible and what actions are not.
In addition, your HOA membership dues will be factored into your total housing expenses. What does this mean for Florida home buyers?
The bottom line: Homeowners associations and their dues can make or break your mortgage and home buying situation. Please do your homework and always factor in the possibility of higher monthly payments whenever dealing with a property that is part of an HOA. Want to see if you qualify for that new Florida home you’ve been eyeing? Click here!
Jason is a lifelong student of the mortgage industry and prides himself on his ability to consistently find the best deals for his clients. With well over a decade of industry knowledge and experience, you can trust that he will help guide you in the right direction for your home financing needs. What separates Jason from everyone else is that fact that he cares so much about the people he helps, driving him to go above and beyond to help make the dream of homeownership possible for all.