By Deborah Goonan, Independent American Communities
The state of Alabama recently enacted a new law that will require all homeowners’ associations (HOAs) to register and file governing and financial documents with the Secretary of State.
The information will be uploaded to a searchable database, so that real estate agents, as well as prospective residents – buyers or even tenants – will know in advance if a particular home is subject to deed restrictions and rules of an HOA.
Although a few other states, such as Florida, require all community associations to register with the state, there is no simple way for consumers to locate and read pertinent information about a particular community.
A mandated searchable database will likely create a higher level of transparency for Alabama HOAs. At the very least, it will put consumers on notice of the existence of a homeowners’ association and provide a relatively simple path for due diligence.
Legislation seeks to clear confusion, post documentation for homeowners’ associations
11 thoughts on “New Alabama law creates state HOA database”
Plenty of Floridian homeowners will tell you that much of Statute 720 is little more than political posturing, too. By and large, state laws are ineffective at reining in abuse of power and corruption in HOAs.
Which is say, this is political posturing of little or no real value to HOA residents. It seems our legislators are owned by developers who donate liberally to their needs, and thus Alabama is still a third-world environment for those who buy into an HOA. See (Google) Florida Statues Chapter 720 for what an HOA law should look like, and be retroactive.
Yes, you are correct.
According to Alabama Secretary of State ( http://sos.alabama.gov/business-entities/homeowners-associations )
The Alabama Homeowners’ Association Act requires all Homeowners’ Associations formed on or after January 1, 2016, to file organizational documents as a nonprofit corporation. The Act was passed on June 2, 2015, became effective January 1, 2016, and is codified in Code of Alabama Title 35, Chapter 20. The Secretary of State implemented administrative rules to carry out certain aspects of Act No. 2015-292, which became effective on April 18, 2016.
Is not the new filing law only pertinent to newly formed HOAs?
Alabama is a dangerous place to purchase real estate. Be prepared.
Ask your REALTOR®/Buyer Agent how your interests are being protected.
Only use an adequately HOA trained professional who will represent & protect you.
Here is the official notice.
Once again, it’s important to note that smaller HOAs and Condo Associations do not hire professional management. They self-manage. But they still experience corruption and/or lack of transparency. The HOA structure itself IS the problem, because there’s little accountability for HOA Boards as well as the management company and/or attorneys.
Emma, I found your comments interesting as I have came across specific situations which sound very similar (HOA management organizations owned by the developer, Law firms that “specialize” in HOA “issues”, multiple level corporate entities that have board of directors that are secret, hiding behind Non Profit Act law, etc. I would be interested in discussing with you some of your experiences. I live in Mount Pleasant, SC but know of multiple issues of this nature throughout SC.
I hear from plenty of owners and residents in self-managed HOAs, Condo Associations with similar complaints.
The ONLY laws that need to be passed are to make it illegal for any HOA to hire a management company to control the funds, enforce the by laws or fine anyone for anything. HOAs are not the problem, HOA MANAGEMENT THUGS AND CROOKS and their hired law firms like John Carona and Associa are the problem. Shut these mafia crime groups down. Just look at the extortion these management companies are pulling nation wide. They must be shut down. Forever.
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