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Posts Tagged ‘HOA Documents’

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Leesburg Town Council voted unanimously to appeal a March 6, 2009 decision by Circuit Court Judge Thomas D. Horne that found the utility rates for Leesburg’s out-of-towners to be “unfair, unreasonable, and inequitable.”

The Court gave the town 90 days to lower the water surcharge for out-of-town residents by 45.51% and the sewer surcharge by 36.53%

The Town Council made the decision to double the rate for water and sewer services for out-of-town users in December 2005– the 100% increase went into effect January 1st, 2006.

Three homeowner associations and six residents filed a lawsuit against the Town challenging that decision.

Judge Horne wrote in his ruling that “The existing surcharge for water and sewer for out-of-town residents is unfair, unreasonable, and inequitable; and that the surcharge for sewer service for out-of-town residents are impracticable, inequitable, non-uniform, and unlawful.”

The Town will not have to refund the overpaid money, as  “the plaintiffs have the burden of overcoming the presumption that such payments were made voluntarily” and the attorney for the Town successfully defended the voluntary payment doctrine by arguing that all out-of-town residents continued to pay their water bills and they were not forced to do so.”    Should one suppose that not paying the bills and risk having the water turned off was a practical and legal option?  

The Town unanimously voted March 24 to appeal the case.  Town Attorney, Jeanette Irby, stated that “the (court) ruling only applies to nine customers” and the Town needs to find “a fair, reasonable and practicable rate for all customers inside and out of town, not just the nine litigants in the case.”  (?)

As a REALTOR, I am very saddened by the unnecessary legal struggle forced by the Town when so many better  options are available – expanding the town boundaries is just one of them, so the “out-of-town” residents  could share the costs and the benefits equally with the town residents.

Looking from the Real Estate Industry’s perspective, the Town’s decision to double the rates unfairly stigmatized those neighborhoods – similarly  to Loudoun County’s decision to approve the alternative septic system and then attempting to ban those systems AFTER homes and entire subdivisions were built . 

The Town’s decision to increase the rates by 100% was unfair to the homeowners, but most of all it was very unfair to home sellers and home buyers, especially to out-of-town home buyers unfamiliar with the Town of Leesburg boundaries and the impact it would have on their water bills. Most people do not know that some neighborhoods in Leesburg are considered “out-of-town” neighborhoods because of their close proximity to the town and no other towns within a reasonable distance.  A reasonable person/buyer would consider those neighborhoods as a part of Leesburg.

Home buyers are entitled to full and correct information when choosing a neighborhood –hence the Town’s decision discriminated unfairly against the home SELLERS, because informed home buyers may have decided to purchase in a home somewhere else, and discriminated against uninformed home BUYERS, because they might have preferred to purchase somewhere else if they had all the information.

In addition, the homeowners are charged/taxed based on their water usage and not based on the value of their home, which is a more equitable measure.   

The desired outcome should be a win-win situation for all parties involved. 

Most of all, Leesburg needs to build a reputation as a town thought after for permanent  address and a preferred town of choice for home buyers  – The Town of Leesburg Council is not serving its “in-town” residents and taxpayers well by acting to the contrary.

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Unfortunately, there seems to be a  pattern of “small town mentality” within the Town Council and complete disregard for the citizens and taxpayers of Leesburg  that shows its ugly head  now and then.

The classic example of abuse of power is the Potomac Crossing subdivision in Leesburg and the way The Town dealt with this neighborhood.   

Potomac Crossing was built north east of Leesburg in the late 1980s. The Town Council very unwisely reserved a small lot in the middle of that residential neighborhood for a commercial area, even though there was no need for another  7-Eleven, or a gas station, or dry cleaners – there are plenty of those services within 1 mile.  Meantime, the builder was promising home buyers swimming pool,  tennis courts, and decent playgrounds for children.  When the residents balked at the idea of the strip mall, which would have increased unwelcome traffic and where teenagers could  have an easy access to cigarettes and alcohol, the Town forced the residents (by exploiting internal strife) to accept the second option and sold the lot to the Mormon Church in 2002.  

The Town have done so by obeying the bare MINIMUM required by the law – that is by informing the least possible number of homeowners ( about 90 out of about 1,000), only the homeowners of the adjacent properties were informed.  Out of the other 900 homeowners, small minority learned about the decision by the word of mouth, the vast majority learned a few years later when they saw bulldozers working on the lot.

The lot was vacant for many years and the homeowners thought the lot was a common area. Most home buyers were told that the lot was a common area – some received HOA documents with the nearby elementary school marked,  but the Mormon Church not marked.

The Leesburg Town Council  and the Town Mayor,  Kristen Umstattd, all too conveniently were hiding behind the elusive “democracy” principle and the “legality” of their decision – p.s. democracy should never be equated with the perfect political system;  democracy simply means that the majority rules, if the majority is wrong the outcome can be quite horrific.  

In reality, the rights of Potomac Crossing homeowners and homebuyers were violated in a broad daylight, and the most basic principles of the TRUE democracy were violated without any consideration for the citizens and the taxpayers that the Town Council presumably represented.

THE BOTTOM LINE is that  HOME BUYERS must and should have the right and the freedom to make an INFORMED decision to purchase their home where they know they and their Family will be happy.  After all, they are purchasing not just a HOUSE, they are purchasing a HOME. No one ever should be hoodwinked into purchasing a home that they would otherwise not purchase if they had ALL the information.  While some homebuyers may not have a problem with the presence of that religious denomination or the other in their backyard, for most homebuyers it is a very PERSONAL and IMPORTANT decision. Living in a  close proximity to the Mormon Church is NOT within a comfort level for many homebuyers.

This is the very bare minimum that the CONSTITUTION should (and I believe/hope it still does) guarantee.  It is only legally and morally right and, in the end, it is the best for all involved.

NOTE: Potomac Crossing is a home for residents of various racial, ethnic, cultural, and religious backgrounds, and no Fair Housing Laws were violated in that neighborhood.

Blatant abuse of power?   Terror by the (small) government?  Shameless abuse of the principle of Democracy?  Lesson in history?   Judge for yourself.

NOTE:  This post represents opinions and personal views of the owner of this blog, Vivianne Rutkowski, and should not be seen as a reflection of the views of Keller Williams Realty.  Each Keller Williams Realty office is independently owned and operated.  

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This Act protects property owners from localities that seek to alter past zoning decisions by enacting new zoning ordinances.
For example, if a structure was constructed in accordance with a local government building permit, and the locality issued a certificate of occupancy or use permit, a later zoning ordinance may not remove it for nonconformity with the new ordinance. It also applies to structures on which an owner has paid taxes to the locality for more than 15 years.

Of course, the question remains what happens if the “building permit” was forced on the HELPLESS citizens by a local, say, town, government to the detriment of the taxpayers? Clearly, the state of Virginia made sure, that the government always has the upper hand, no matter how unfair or unjust the decision.

Such was the case of the Mormon Church in Potomac Crossing in Leesburg, Virginia. There was literally NOTHING that the Home Owners could do against the Town government of Kristen Umstattd, Leesburg mayor, once the Town made the decision to rezone and sell a lot to the Mormon Church, a lot that was supposed to be used originally for the tennis courts and play grounds for children.

The Town of Leesburg very unwisely zoned a small lot in the middle of a residential area as COMMERCIAL by PREVIOUS Town Council (1988, no need existed for the commercial area, pure politics), and when opposed by the Home Owners, The Town rezoned the lot and gingerly sold it to the Mormon Church in 2002 without communicating the sale to the Home Owners. The Town contacted the adjacent 92 properties – minimum required by the law. Over 800 HO were never contacted by The Town or the HOA.

To make it worse, many new Home Buyers were issued HOA documents that did not have the church marked on the map, even though an elementary school nearby was marked, long after the rezoning and sale of the lot. The sold lot was “vacant” for many years and many new buyers were told it was a common area. Indeed, many original Home Owners believed the lot was “common area” until one beautiful day in March 2008 they noticed bulldozers  working on the lot.

My point is that The Vested Rights Reform looks good on the surface and it appears to be Property Owner friendly, but in reality, like anything else in life, it can be misused and even abused by government(s) and special interest groups.

SOURCE: Virginia Association of REALTORS

NOTE: The interpretation of this legislature and comment is my personal, and is not a reflection on Keller Williams Realty or Virginia Association of REALTORS

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Effective July 1, 2008 there is a new law in Virginia,  Property Owners’ Association (POA) Act and Condominium Act.

This is a long overdue law.  Until now the HOA documents were an important part of the real estate transaction and the contract – so important that HOA documents alone could make or break the real estate contract – yet, there was no federal or state law governing POAs .  Sellers, by law, are obligated to deliver the HOA documents to the Buyer and based on those documents Home Buyers have 3 days to decide whether they want to reside in a given community or to void the contract.

Interestingly, in the state of Virginia, as important as the HOA documents are to the Real Estate transaction itself, there was NO  Board that had a jurisdiction over the Home Owner Associations.

It meant that if Home Owners within a given HOA had a valid complaint against their HOA board they had nowhere to turn to.  It also means that if Buyers received fraudulent HOA documents, they also had nowhere to turn to.   Not much of a comfort!

That changed July 1, 2008.

The Property Owners’ Association Act and Condominium Act created the Virginia Common Interest Community Board to investigate complaints about community association managers.

This ACT also makes other changes:

  • requires associations to publish certificate or packet fees in electronic or paper format
  • enables sellers or agents to request electronic delivery, and they may designate two additional recipients to receive the materials in electronic form at no additional charge

Most importantly, the ACT established the maximum amount that the HOAs are allowed to charge as fees for the HOA documents.  The fees cannot exceed:

  • 100 for a property inspection
  • $150 for two copies of the disclosure packet in hard copy and $125 for two copies of the disclosure packet in electronic form; only one fee may be charged
  • $50 for an expedite fee
  • $25 for an additional hard copy
  • $50 for a post-closing fee

Additionally:

  • For no more than $50, an update, delivered within 10 days of a written request, may be requested if a packet or resale certificate was issued within the previous 12 months

These changes only apply to associations who have hired a management company or who have a full-time staff.

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Complaints against POAs, condominiums, property owners’ association, and cooperatives, can be filed with:  

http://www.dpor.virginia.gov/dporweb/cic_ombuds.cfm

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SOURCE:  Virginia Association of REALTORS

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NOTE: Advertisement Ads which appear in most posts on this Blog are run by WordPress and do NOT necessarily represent the views of Vivianne Rutkowski or Keller Williams Realty. Visitors to this blog are NOT obligated to click the ads to visit this blog.

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The most fundamental right of every Home Buyer is the right to purchase a home that is best suited to their needs and lifestyle, and where they know their Family will be happy.  After all, they are purchasing NOT just a house, they are purchasing a HOME.  This is the minimum of protection that should be guaranteed by the CONSTITUTION.  It goes into the heart of individual rights and property rights.

Virginia Property Owners’ Association Act requires Home Seller to disclose if their house is located within a development that is subject to the Virginia Property Owner’s Association Act. The POA Act requires the Seller of the property within such a development to obtain an Association Disclosure packet from the property owners’ association and provide it to the Purchaser.  The information in the Association Disclosure Packet should be current as of  a date-specified on the Association Disclosure Packet.

This is very important to understand because all the information and all the data may be correct in the Packet leading up to the date on the Packet, but very misleading if changes in community bylaws were made after that date or if any other information changed (ex. there is a lawsuit against the HOA).  This is why it is wise and important to ALWAYS request an UPDATE to the Packet. The Seller has the obligation to provide the Packet for the Home Buyer, but the Buyer has the right – at the Buyer’s expense – to request an update to the HOA Packet.

Virginia Jurisdictional Addendum states very clearly: “The Purchaser, at the Purchaser’s expense, shall have the right to request that the association provide an update of the Association Disclosure Packet previously furnished, along with the assurance that there have been no material change, or if there have been material change, a statement specifying such changes”.

Virginia POA Act is the STATE LAW in Virginia.   It means that a Seller of a property CANNOT legally request of a Buyer to forgo the HOA Documents or the Condominium Documents.  This includes the foreclosed properties – banks are NOT above the law.  The Buyer has the right to demand the HOA documents BEFORE making the decision.

What if a POA Packet is delivered with  incomplete, misleading information as to the material facts?

It appears to be the case in Potomac Crossing, Leesburg, VA where Home Buyers received HOA documents that included a MAP of the community with the elementary school near by marked on the map but the Mormon church was NOT marked.  Many Home Buyers were told that the lot was common area and nothing ever was going to be built on it.   The HOA docs should have had the information current as of  a date-specified on the Association Disclosure Packet but did NOT.

Again,  Virginia Property Owners’ Association Act IS THE STATE LAW – whenever there is a proof that the law was violated, an attorney should be contacted for legal advise.

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NOTE: Advertisement Ads which appear in most posts on this Blog are run by WordPress and do NOT necessarily represent the views of Vivianne Rutkowski or Keller Williams Realty. Visitors to this blog are NOT obligated to click the ads to visit this blog.

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