HOA rules to check before you buy

Where the rules live

An association's rules usually come in layers:

• The declaration, sometimes called the CC&Rs, recorded in the county's property records. It creates the association and sets the big restrictions, such as use and leasing.
• The bylaws, which govern how the association is run, including elections, meetings and voting.
• Rules and regulations, adopted by the board, which cover day-to-day matters like parking, trash and pool hours.
• Architectural or design guidelines, which control exterior changes.

Rules adopted by the board can usually change more easily than the declaration. Recent meeting minutes show what is being discussed.

Your right to the documents in Texas

States handle this differently. Texas Property Code section 5.012 requires sellers of homes in property owners' associations to give buyers a notice of membership. The statutory notice tells buyers they must be members, must pay assessments that can change, and that failing to pay could lead to enforcement of the association's lien and foreclosure. It also says owners are entitled to copies of governing documents and a resale certificate, which states the regular assessments and lawsuits the association is part of, among other things.

If the seller does not provide the notice before the contract binds the buyer, the buyer may terminate for any reason within the earlier of seven days after receiving it or the date of transfer. The section does not apply to condominium sales, which Texas handles separately. Other states have their own disclosure and resale certificate rules.

Rules that often surprise owners

Leasing deserves particular attention. Even if you plan to live in the home for years, plans change. A rental ban or a cap that is already full can make it hard to keep the home if you need to move. Leasing rules can also affect financing. Fannie Mae's ineligible project rules include projects that require owners to put units into a rental pool or restrict when owners may occupy their units.

Where federal law limits HOA rules

Associations cannot adopt rules that violate federal law. Two examples:

Satellite dishes and antennas. The FCC's over-the-air reception devices rule, at 47 CFR 1.4000, applies to private covenants and homeowners' association rules as well as local laws. On property within an owner's exclusive use or control, a restriction cannot impair the installation, maintenance or use of covered antennas, such as satellite dishes one meter or less in diameter or TV antennas. The rule says a restriction impairs if it unreasonably delays or prevents installation, unreasonably increases cost or prevents an acceptable signal. Exceptions exist for safety and historic preservation. Common areas the owner does not control are generally outside the rule.

Fair housing. HUD's overview of the Fair Housing Act lists the protected characteristics: race, color, national origin, religion, sex, familial status and disability. Association rules and their enforcement are subject to that law.

Some states add their own limits on what association rules can restrict. Check your state's laws or ask a local real estate attorney.

Questions to ask the association

• Are any rule changes proposed or under discussion?
• How many violation notices or fines were issued last year, and for what?
• Is the leasing cap full, and is there a waiting list?
• How long does architectural approval usually take?
• Is the association involved in any lawsuits?

The bottom line

HOA rules are part of what you buy. Read the declaration, bylaws, rules and design guidelines before your deadlines pass, with special attention to leasing, pets, parking and exterior changes. Federal law limits some rules, such as satellite dish bans and anything that violates fair housing law, and states add their own protections.