 CC&R's -
Isn't that a 60's Rock Band?
Whether
during the construction of your new home or just prior to closing,
you should have received a copy of your association's CC&R's,
which stands for Covenants, Conditions, and Restrictions. CC&R's
are filed with the real property records of the county in which
the association is located and operates and are the rules and
regulations that govern the association. The CC&R's are often
referred to as the deed restrictions, declarations, or master
deed for the community. While this may sound menacing, they are
simply the rules by which the property owners are to conduct
themselves as well as guidelines to assist the board of directors
in managing the association. While most home buyers give little
attention to these documents before closing, these are almost
as critical as the loan documents because they are a legal contract
binding the owner and the owner's prescribed land use as a member
of the association.
The
CC&R's contain specific information for the homeowner regarding
required dues and fees, obligation of the association for maintenance
of the common area, the use of community facilities and services,
as well as restrictions on future property development or remodeling.
Understanding these rules up front can prevent confusion and
misunderstanding between the homeowner and the association's
board of directors.
The
governing documents of an association consist of more than
the CC&R's. Sometimes referred to as the ABC's of association
operations, the Articles of Incorporation, the By-laws, and
the Covenants each play an important role in how an association
is required to operate.
The
Articles of Incorporation are not required for associations
with the exception of cooperatives; however, most associations
are incorporated as not-for-profit, non-stock corporations.
The Articles of Incorporation bring the corporation into existence,
define the fundamental purpose and powers of the association,
and identify the initial board of directors.
The
By-laws are the formal rule book for the administration of
the association and day-to-day management of the association.
By-laws will typically lay out the specific powers and duties
of the association, its officers or directors, and the management
company. Other items addressed in the by-laws include notice
and quorum requirements for meetings of the association (annual,
special, and board meetings), voting rights, and procedures
for the election or removal of board members.
Association Times' Staff Writer
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