The Honest Broker: HOA’s and Special Assessments

The Honest Broker: HOA’s and Special Assessments

By:  Diane Lott, Broker   Paradise Found Realty

If you happen to live in an HOA-managed community, you may have to deal with a special assessment at some point in your ownership.  Typically, HOA special assessments are rare and should only happen in unusual circumstances, but they will mean an extra and unexpected cost for the homeowner. Typically, this should only be required by the HOA board in emergencies or when unexpected bills are due in the community. The special assessment will mean an extra payment is required from the homeowners above their normal monthly HOA fees. The idea of the special assessment is to find the money to pay for unexpected repairs and are needed because the association doesn’t have the funds in their budget to cover the costs. Unfortunately, if you are living in this type of community, you’ll need to pay the special assessments when they happen. 

Generally, HOAs only resort to these assessments when something unexpectedly has happened and there is a large bill to pay. It could be something that requires an urgent repair that the association doesn’t have the funds to cover. Even so, there will need to be a vote on this before it will be charged to the community. These assessments can also happen when the HOA has not budgeted well for the year. If the homeowner’s association has underestimated the expenses for the coming year, the normal HOA fees will not cover the costs. This can lead to the board resorting to calling for a special assessment, and unexpected additional costs for homeowners.

Coping with this unexpected cost can be difficult if you’re not prepared. Sometimes these charges can be quite large, but there are some things you can do to better deal with the situation. You might be required to pay the assessment charge very quickly if the amount of money isn’t that high. But if you are required to pay a large amount, this might be spread out over many months or even a year. The homeowner’s association board will decide how quickly the money needs to be paid based on the urgency and other factors.

What if you disagree and refuse to pay it? When you purchase in these communities, you have “accepted” the HOA covenants, conditions, and restrictions. Those have legally set out the rules for living in the community and will also include a section about special assessments. This means that if the HOA triggers a special assessment, you are legally required to pay.

You could take the HOA to court to fight it, but if it is found by the judge that the assessment is reasonable, as outlined in the contract you agreed to, you could be liable for more legal costs. If you simply ignore requests to pay the assessment, there will likely be late fees you due as per the HOA covenants. You also run the risk of your homeowner’s association taking you to court, as well as being restricted in your usage of community facilities. When buying a home, it is advisable to set money aside for many unexpected costs and this is one of them. 

How will a special assessment affect you if you are either buying or selling a home? The point at which the sale closes will affect who is required to pay the assessment costs. When you’re buying a home, the real estate agent, by law, must disclose any active, or potential, special assessment that is under consideration. The date on which the special assessment comes into effect will decide who ends up paying the charge. If this is after closing, the buyer will have to pay. When the assessment happens before closing, it will be the seller who pays it and normally not passed on to the buyer if negotiated in the terms of the sale. 

If considering buying in an HOA, it is advisable to do some research of the community by speaking to residents about how the community is managed and if there is anything that is coming “down the pike” with regards to a special assessment.  Make yourself well-informed.

Be Well!


Diane Lott, Broker

Owner: Paradise Found Realty

*The highest compliment you can give is when you feel you can refer a friend…
  Hope to see them soon!

Paradise Found Realty, Inc. of Palm City



Phone:  954-294-5060

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