THE RULES OF ASSOCIATION
by Nancy Dunnan

Want to paint your front door pink, periwinkle or purple? Let wild mushrooms grow in the back yard? Like to sunbath in the nude? If so, I'd steer clear of buying property where you automatically become a member of a homeowners association.

On the other hand, if you like rules, regulations and restrictions that keep things tight and tidy, the only concerns you need have are:

1. The homeowners association has cash reserves
2. Its rules and board are reasonable
3. The board has term limits

A Growing Trend
According to the non-profit National Center for Policy Action, approximately one in six people in America, or about 50 million residents, live in a community regulated by a homeowners association. These range from co-op apartment buildings in big cities to subdivisions in small suburbs.

So when you buy a home in a new subdivision, a planned unit development (PUD), a common interest development (CID) or a co-op, it's very likely your deed will in include something called covenants, conditions and restrictions (CC&Rs) that regulate property use. As part of the deal, you automatically become a member of the association—there's no saying "no."

Some associations enforce each and every rule in strict military style; others are less regimented. Their purpose is to protect the community, to maintain the common property and to enhance the value of the houses or apartments in the association.

De Facto Governments
The typical homeowner's association:
* Collects association dues. These help maintain the common property, including landscaping, playgrounds, pools, security patrols.
* Imposes special assessments. These are used to finance major improvements and repairs.
* Enforces rules. These include house paint colors, parking policies and the like (see list below).
* Fines residents who break the rules.
* Forecloses. In rare cases, the board can foreclose on homeowners who cannot afford dues, assessments, fines.

Before you Sign on the Dotted Line
It's not uncommon for homeowners to sign away their rights without realizing they've done so. And after you sign, it's too late to do anything about it. So, before going to contract, find out if the property you're considering comes with a CC&R. If it does, read the document carefully to see if the regulations are compatible with how you like to live. And ask to see the association's financial records. If these documents are complex, your lawyer should review them with you.

Talk to any residents you know. Ask to meet with a board member. Find out what problems there may be.

The most common CC&R governs the colors you can paint your house. But they can have much broader control over other aspects of your day-to-day life. Among the things associations often regulate are:

* Basketball hoops
* Blinds and drapes facing the street
* Boats—number and where parked
* Cars—number and where parked
* Clotheslines
* Fences
* Flag flying
* Garage sales
* Garbage cans
* Home businesses
* Lawns, landscaping, trees, hedges
* Lawnmowing schedules
* Mailboxes
* Motorcycles, motorbikes, motor scooters
* Noise
* Open garage doors
* Outdoor lights
* Open garage doors
* Pets
* Pools
* RVs
* Roof shingles
* Sheds
* Signs on lawns or in windows
* Swingsets
* TV antennas
* Trailers
* Tree houses
* Wind chimes

Making Changes
If, after you move in, you're unhappy and want to get a variance, even a small variance such as getting a kitten or putting up a retractable clothesline, you'll be required to submit an application and pay a nonrefundable administrative fee. You may be asked to attend a formal hearing. You may or may not win your case.

And, if you wish to go a step further and make a structural change, such as building a fence, adding a deck or enlarging the kitchen, you'll not only have to get permission from the association but you'll also be required to comply with the area's zoning rules.

If you decide the heck with it, and fly the flag from a 12-foot flagpole even though it's against the rules, your association can fine you. In rare cases, if you don't pay the fine, the association has the right to collect the money by selling your house—not very likely to happen but such drastic steps could be part of the bylaws.

Fees and Assessments
Homeowners associations also have mandatory monthly fees, used to take care of any common property, such as lawns, swimming pools, jogging paths, golf courses, tennis courts, or lakeside docks. Fees are typically hiked as expenses rise.

Most associations can also impose hefty special assessments (without getting a majority membership vote) for major things such as a new roof, updated electric system, or structural shoring up of a building.

If you're on a tight budget, these payments can be onerous. So, before moving in, find out how much and how often the board can raise fees and levy assessments.

Bottom Line: Look Before You Leap
If you move into a community run by a homeowners association, you are required to abide by its rules, like them or not. If you don't want to live by the legally-binding covenants, then buy somewhere else. On the other hand, if the association has reasonable bylaws, an emergency reserve and intelligent board members, you will benefit from the protection it offers residents and their property.

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