HOA Finance

Are You Prepared for the New Annual Disclosures?

Published on: September 19, 2014 | by Steven J. Tinnelly, Esq.

For many associations with a December year end, September marks the first opportunity for the board of directors to review the first draft of the budget and disclosures materials. As of January 1, 2014, changes to the Davis-Stirling Act now require that budget documents and disclosures be distributed in the form of the Annual Budget Report and the Annual Policy Statement.

Civil Code §5300 requires the Annual Budget Report (“Report”) be distributed to the membership 30-90 days prior to the fiscal year end. Unless the governing documents provide for more stringent standards, the Report must now include the following documents:
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Association Reserve Accounts and Reserve Studies

Published on: May 6, 2013 | by Steven J. Tinnelly, Esq.

piggy bank reserve studies hoa reserve accounts.png *New Library Article

“Always be prepared.” That simple phrase sums up the importance of funding and properly maintaining a reserve account. Accidents and surprise maintenance issues will inevitably pop up. When they do, the HOA that has been properly funding and managing its reserve account will be prepared to do what is necessary to protect the interests of the HOA and its members.

Our HOA lawyers have published a new article entitled “Association Reserve Accounts and Reserve Studies.” It covers the basics of reserve accounts and reserve studies, their importance, and the relevant obligations of a HOA and its Board. The article is available for download from our library.

Legislative & Case Law Update (2013) Now Available!

Published on: January 7, 2013 | by Steven J. Tinnelly, Esq.

hoa laws Our annual “Legislative & Case Law Update” newsletter for the year 2013 is now available in our library!

The Legislative & Case Law Update provides an overview of the new legislation and case law impacting California Homeowners Associations (“HOAs”) as we head into 2013. The new legislation includes, among other items, bills that impact Bank foreclosures, the re-organization of the Davis-Stirling Act, EV Charging Stations and fees charged by HOAs in producing certain records. The new case law includes rulings that may impact the architectural restrictions placed on the installation of solar panels, arbitration provisions for construction defect disputes, “no-cost” HOA collections contracts, election disputes and defamation claims. The Legislative & Case Law Update also addresses some new Fannie Mae and FHA regulations impacting condominium insurance and certification requirements.

Click here to read our Legislative & Case Law Update (2013)

Have questions on any of the new legislation or case law? Click here to send us a question online.

FHA Releases Revisions to Condominium Approval Guidelines

Published on: September 13, 2012 | by Steven J. Tinnelly, Esq.

The Community Associations Institute (CAI) has just reported that the Federal Housing Administration (FHA) has released revisions to its condominium approval guidelines. In response to recent market and industry pressure, the FHA has determined to modify the existing rules and standards regulating the eligibility of condominiums to acquire FHA financing. CAI’s initial review of the revisions indicate that the substantive changes are as follows:

Delinquencies: No more than 15 percent of units may be more than 60 days delinquent. Previously the threshold involved a 30 day limitation.
Employee Dishonesty Insurance: All new and established condominium projects with more than 20 units will be required to obtain and maintain employee dishonesty insurance covering all directors, officers, employees and agents of the Association.
Project Certification: Individuals submitting a condominium project for approval under the new rules will be required to certify that (a) all information is true and correct, (b) they have reviewed the project application and it meets all applicable state and local laws and (c) they have no knowledge of circumstances that would adversely affect the project (litigation, operational issues, etc.)
Commercial Space Limits: FHA will consider approving projects with commercial space between 25% and 35% through the HRAP process. Mixed use projects up to 50% will also be considered subject to substantial documentation.

For a further analysis and review of the updated FHA condominium guidelines, click here to access CAI’s recent member article.

The Tinnelly Law Group serves as legal counsel to community associations, homeowners associations, and condominium developments throughout California.

Association Repair and Renovation Loans

Published on: March 19, 2012 | by Steven J. Tinnelly, Esq.

hoa attorney *New Resource

As communities mature, the need for major repairs or renovations can become a major concern. Often because of unforeseen problems or insufficiently funded reserves, community associations (associations) are not capable of funding the necessary repairs immediately. In order to avoid a piecemeal repair effort in such situations, or the possibility of additional problems arising from the postponement of the repairs, it may become necessary for an association to borrow money. Fortunately, many banks have recognized this need and are willing to lend to associations for major repairs and renovations.

This blog post addresses some of the more frequently asked questions and important issues relating to association borrowing, such as the common reasons for borrowing, what a bank uses for collateral, and what effect the loan has on individual homeowners.

Our HOA attorneys have also published this information in our new resource entitled “Association Repair and Renovation Loans”, available for download from our library.