HOMEOWNER ASSOCIATIONS

Homeowners’ Association(HOA) is an American corporation established by the real estate world for the purpose of marketing, managing, selling and buying ofproperties. The basic purpose of creating this association is to promote a fair and honest environment where everyone can invest in property business without the fear of any kind of fraudulent activities. The authority of the homeowners’ association is selected through voting by its members. To purchase or sell anything under HOA, you should be an active member of this corporation. Membership in the homeowners’ association by a residential buyer is typically a condition of purchase and nobody can reject it.

TIPS TO FOLLOW WHILE DEALING WITH HOA:

In the 1960s, about 500 HOA’s existed in the United States and since then, it is still increasing in numbers. A Homeowner Association Website upholds the covenants of a subdivision, development or condominium complex. The homeowners’ association offer a wide range of benefits to its members. Let’s have a deep look onto this association.

BENEFITS OFFERED BY HOA:

•    All residents are given an open opportunity to amend the conditions and restrictions associated with the property dealing under HOA.

•    These associations maintain the common schemes of development and reduce the owner’s maintenance responsibility.

•    HOA manage the exterior appearance of single family homes and the conductof owners, tenants and guests.

•    HOA also regulate and operate the common property for the usage of its members, tenants and their guests.

•    Common property under HOA provides the residents with the facility of amenities, like swimming pools, club houses, gyms and football grounds along with tennis courts. Jogging and hiking tracks are also associated with HOA’s common properties.

Aside of all the benefits provided by hometown associations, there are certain risks that are also attributed to HOA. Some of themare discussed below:

FINANCIAL RISKS:

•    In certain states of USA, a hometown association can foreclose a member’s property without any prior notification and judicial procedure. The aim behind this act is to collect extra fees, fines or any kind of enforceable lien on the property’s sale.

•    In the Florida state, it requires a judicial hearing for the foreclosure. This case can only occur when a power of sale clause exists in a mortgage or deed of interest.

FORECLOSURE PURCHASE:

If any foreclosure purchase is under consideration, it is necessary to be aware of all the pros and cons related to this act.

PROS OF PURCHASE:

The following are the benefits of buying any foreclosure:

•    Home upgrades:

The purchasers can use a home’s foreclosure status to their advantage for buying a larger property in a more desirable area.

•    Financial gains:

While buying a foreclosure, you pay below the market rate price.However, your investment could return huge profitson the resale of the property if you get extra value on it.

CONS OF BUYING A FORECLOSURE:

The disadvantages associated with purchasing a foreclosure are as following:

•    Home in foreclosure requires regular repairs, and a homeowner is in pre-foreclosure because the owner cannot keep up with monthly mortgage payments

•    Homes at the stage of REO phase of foreclosure are mostly in worst condition. As foreclosure is a lengthy process, many REO properties remained empty for years with no maintenance or care.

So be careful before buying a foreclosure for a better investment in property business. Search for more information, please visit at http://www.instapage.org.