There’s been a spat of negative stories recently about housing association civility gone awry. These cash-strapped times are making life stressful for all levels of government, and HOAs in communities slammed by the housing crisis are far from immune.

According to the Atlanta Journal-Constitution :

When Helen Burgess fell behind on her bills after being diagnosed with cancer, she was able to work out payment plans on her mortgage, car note, credit card and tax obligations to the Internal Revenue Service.

Georgia is one of about 30 states where HOAs are empowered to take such drastic action. Though solid data on the trend is not available, by all accounts, such foreclosures — and other get-tough tactics — have occurred more often during this recession than in previous downturns.

Her neighbors weren’t so accommodating.

Because Burgess was late on her condo fees, the Magnolia Lane Condominium Association cut off her water soon after she returned home from surgery. That was June 27, 2009.

Since then, Burgess has been hauling water from her niece’s house 10 miles away. The condo group also tried in vain to garnishee the Marietta woman’s pay to collect the dues it’s owed, which, including attorneys’ fees, now totals more than $5,000. Most recently, it banned Burgess or her guests from using the clubhouse and other facilities in the 76-unit Marietta community.

“This is the craziest mess I’ve ever had to deal with. It’s been an ordeal,” said Burgess, 59, who has been unable to reach a financial agreement with the association. She even asked her pastor to intervene. It didn’t help.

The condo association and its attorney declined to discuss Burgess’ situation, other than to say they are “trying to work with her.”

While Burgess’ treatment may seem harsh, she’s more fortunate than some homeowners in similar situations. Some who have fallen behind on homeowners association fees — despite being current on their mortgages — have been sent into foreclosure by associations determined to collect.

Still, a housing development or neighborhood with a robust housing association can offer several advantages over less-organized communties. Let’s review some of the goods and bads of HOAs:

Take My Dues, Please!

• Value. Value. Value. Usually, the rules, conditions and restrictions are there to protect the value of your home and make life just a little bit better for everyone living around you. You’ll be thankful for an HOA’s power when someone decides to start raising rowdy roosters next door.
• Neighborhoods with an active HOA tend to have a stronger sense of community. HOAs maintain common areas like pools and clubhouses, organize events, and help build an atmosphere of safety and security that allows people to get out and mingle.
• Curb appeal. It’s HOAs who usually take an active interest in a neighborhood’s entrances and appearance from the outside.
• HOAs can be a handy arbitrator in local disputes—say, when you finally get fed up with your neighbor’s backyard cock-fighting ring.
• Imagine not spending your Saturday mowing the lawn or shoveling snow off the driveway. HOA dues will often be used to pay for these sorts of services (at discounted bulk-rate prices).

Get Off My Lawn!

• Dues are probably mandatory. Even if you could promise to never use the pool or clubhouse, you can’t really opt out of the security and home values boost that is common for everyone in an HOA-active neighborhood.
• Dues may rise. Even if you are satisfied with the space they clog in your budget when you move in, the numbers may change over time. Find out about potential changes before you sign.
• Your beloved purple window shutters might have to go if they don’t fit the desired overall neighborhood feel.
• Your beloved purple poodle might also have to go. Some HOAs (especially in condos and smaller urban spaces) might not allow pets, and still others (retirement communities) might not allow kids.
• If you keep your beloved purple shutters, poodles and progeny, you could be fined. If you don’t pay these fines, they could try to foreclose on your home (see above).

It can be a community-boosting, home value-boosting, experience. Or you might find yourself locked out of your house for missing HOA payments while serving a tour in Iraq . You never know.

Fortunately, our Dallas-Ft. Worth real estate experts know the local markets inside and out. Contact us —we’ll help you find the right community.

Tags: hoa, Home Loans, home purchase, homebuying advice

This entry was posted on Wednesday, July 14th, 2010 at 2:44 pm and is filed under Mortgage News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.