A quick tour of your favorite search engine's menu on the topic of "disbanding homeowner's associations" sites would be mildly entertaining if inquiries weren't so fraught with rants and anger. A great HOA does nothing but help a community share expenses and responsibility, but when power is abused and members reach a collective breaking point, there's nothing to be done short of cutting the umbilical cord that holds residents to an existing, structured code of conduct. Every state has its own set of laws governing the dissolution of associations and HOAs fall into this category, so the guidelines in this article can take you only so far before you'll need to call in a lawyer to help you sort things out.
Have a clear understanding of what your homeowner's association does. If you disband yours, every resident will become equally responsible for overseeing or paying for landscaping, pavement repair, security, waste disposal, snow removal and myriad other communal services included in the original covenant between residents and the association. Once the HOA is disbanded, there will be no common law to govern the property and associated structures, so you'll want to have another organization in place to pick up where the HOA leaves off.
Meet with all members to comb through your CC&Rs. Think of your property's Covenants, Conditions and Restrictions as the skeletal structure that keeps the community erect and functioning; the rules and documents that legally dictate how the association operates and the limits to which individuals may modify their residences. Every member of your housing neighborhood was required to sign a CC&R on the day the property closed and this subjugated their individual rights to the rulings of the association. Whether you live in a townhouse, condo or subdivision, restrictions governing what you may and may not do were set according to association rules. Only sanctions that conflict with federal, state or local law may be challenged.
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Try to restructure the homeowner's association by majority rule before you make a final commitment to dissolution. With a super-majority of votes on behalf of the members, a plan for re-configuring the association and a community commitment to making certain new guidelines and restrictions are more egalitarian and equitable and can also save your association a lot of time and money. If at all possible, find a way to restructure the HOA without having to take the drastic step of disbanding it.
Contact your state's Housing and Urban Development office and speak with someone about your unique situation. They can give you valuable information about your legal standing and rights. Every state is different. For example, in North Carolina, an HOA dissolution requires 80% of the membership as set by the state's General Assembly if the association was formed after 1999, but if it was chartered before that year, only 67% of homeowners are required to pass the termination vote. This complex arrangement is just one state's guideline; find out specifically what your state requires to do the job.
Seek the help of a real estate attorney once a majority of HOA members agrees that there is no other recourse but disbanding. Schedule a community meeting with the attorney and advise all homeowners of the date and time since it is critical that all voices be heard at this important meeting. Send a copy of your CC&Rs to the attorney beforehand and have residents sign a statement saying that they are willing to help pay their share of legal fees incurred as a result of exploring HOA dissolution with a lawyer. Without this agreement, things are very likely to get contentious.
Make a community commitment to address all of the reasons residents took this radical step. Once residents are again in the driver's seat, the new board may even begin to have some compassion for the folks who had previously been seen as dictators. It's an enormous responsibility to govern a community--one that looks decidedly different once you're in charge.
Based in Chicago, Gail Cohen has been a professional writer for more than 30 years. She has authored and co-authored 14 books and penned hundreds of articles in consumer and trade publications, including the Illinois-based "Daily Herald" newspaper. Her newest book, "The Christmas Quilt," was published in December 2011.