This By-Laws document for a condominium association contains information concerning: restrictions, the board of directors, and the advisary committee.
Condo Bylaws Association With No Reserves In Pima
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State:
Multi-State
County:
Pima
Control #:
US-00452
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Word;
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FAQ
As an HOA reserves rule of thumb, the reserve account should be at least 70 percent funded.
Originally published in 1998, the National Reserve Study Standards provide a consistent set of terminology, calculations, and expectations so reserve study providers and those they serve together can build a successful future for millions of community association homeowners across the country.
The frequency of your reserve studies is also dependent on your individual state's requirements. Some states like California and Utah require a study to be performed every 3 years, whereas Nevada only requires them every 5 years.
Every property has its own unique list of common area assets that the HOA is responsible to maintain. On average, HOAs should be setting aside 15% to 40% of their total assessments towards Reserves. This percentage holds true for all types of associations.
As an HOA reserves rule of thumb, the reserve account should be at least 70 percent funded. If the reserve study determined that the account should have $30,000, you will be relatively safe with at least $21,000. That way, if there is an urgent matter, you will only need to collect $9,000 more from the homeowners.
No Reserve Fund Equals Higher Dues or Special Assessments An HOA without an adequate reserve fund may have to increase dues significantly right away or levy special assessments. Neither of these options will get you popularity points with the development's homeowners.
The Federal Housing Administration (FHA) has weighed in by requiring approved inium projects to have at least 10% of the annual operating budget set aside for reserves. However, that percentage is arbitrary and is usually never enough for an association that has to paint and replace roofs.
For iniums, such expenses are funded through reserves. To obtain FHA approval, a inium association must allocate at least 10% of its budget to provide funding for replacement reserves and capital expenditures.