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What are HOAs?

When starting the homebuying process, you're likely to hear a lot of unfamiliar terms and acronyms…PMI, FRM, APR.

Today, we're de-coding "HOA," an abbreviation for homeowners association.

HOAs provide structure to the communities they govern, protect property values and ensure the area is a pleasant place to live. In fact, about 20% of today's homeowners live in developments governed by HOAs. As the name suggests, they are run and funded by residents in the community. When you live in a development with an HOA, you automatically become a member of the association and must follow their rules and pay scheduled fees for the upkeep of the overall development.

What do the fees cover?

HOA fees help maintain the quality of life for your community and protect home values for all residents. The fees they charge vary significantly from one HOA to another and depend on how much it costs to operate your development and fund capital reserves. These fees are separate from your mortgage payment and could be scheduled monthly, quarterly, or annually.

HOA fees can depend on a variety of factors including the amenities your HOA offers and the maintenance and insurance for common grounds.

Your HOA fees may cover the following types of services:

  • Trash removal

  • Snow removal

  • Lawn care for common areas

  • Pest control

  • Maintenance and repair for common areas like recreation rooms or pool

What are the rules?

Every HOA has an established set of governing rules all residents must follow. The rules vary from one HOA to the next, but they are legally enforceable. Examples of HOA rules could include:

  • Paint colors for your front door

  • Types of trees and shrubs you can plant

  • Pet policies

  • Parking policies

Do your research if you are considering buying a property with an HOA to make sure you can and are comfortable with fulfilling your membership obligations. When budgeting and planning for home ownership, remember to account for your HOA fees, keeping in mind they can increase each year with the cost of services. Not only is it part of your responsibility as a homeowner, but HOAs can take legal action for non-payment, so it's important to pay your HOA fees on time and in full.

Visit us at for information on our first time buyers mortgage and generous down payment and closing cost assistance programs. You will be glad you did.

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