An organization in a planned community, condo, or subdivision that sets and enforces rules and collects fees to maintain common areas.
Full Definition
An HOA is a governing organization for a residential community — common in condos, townhome complexes, and planned subdivisions. HOA fees cover maintenance of common areas (pools, landscaping, hallways), exterior building maintenance (condos), and sometimes utilities. Fees range from under $100/month in some neighborhoods to $1,000+/month in luxury high-rises. HOA fees affect mortgage qualification because lenders include them in the front-end DTI calculation. HOAs can also place liens on properties for unpaid dues. When buying an HOA property, review the HOA's financial statements, reserve fund adequacy, and rules (CC&Rs) carefully before purchase — some HOAs restrict rentals, pets, or exterior modifications significantly.
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