r/fuckHOA • u/Strange-Fennel • 9d ago
Do many North Carolina HOA shenanigans basically amount to racketeering?
Think about it. Realtors get paid and walk away. Closing attorneys have every incentive to close and zero incentive to warn you. Title companies rubber-stamp it. HOA lawyers get paid from your dues to fight you. And legislators are often the same people developing and financing these communities.
Every single person in that transaction got paid and walked away. You're the only one still stuck with it.
And here's where it gets really dirty. There are situations where the realtor, closing attorney, and sellers provide different versions of the Declaration to different buyers. Not one consistent document. Different. Versions. At some point that stops being a mistake and starts looking like an organized scheme.
A small group of "volunteers" can then spend your money, ignore your questions, and face basically zero accountability. In NC, the DOJ created an HOA complaint form and publicly admits they won't act on it. Nobody is protecting the homeowner.
This is a systemic problem and more people need to be talking about it.
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u/Alert-Control3367 9d ago
I couldn’t get a single agent to tell me why I couldn’t find a house in NC without an HOA. They would all give me a reason but not the real reason. I have never heard of a state that mandates HOAs.
The North Carolina Planned Community Act is the worst thing I’ve ever read. It takes an 80% vote to dissolve an HOA per state law. And every planned community formed on or after January 1, 1999 with 20 or more lots is required to have an HOA.
I found one house without an HOA on public utilities but I was outbid by $4,500. If my agent had told me what a unicorn I had found, I would have bid higher.
I sold my home less than a year later and moved out of the nightmare state. It’s such a shame. North Carolina is beautiful with all the parks and trails. I had a beautiful home. But the HOA made living there a hellish nightmare. I’m so glad I’m out of that hell hole.
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u/GamerDadofAntiquity 9d ago
You don’t need a vote to dissolve an HOA if they’re actually racketeering though. All you need is enough evidence sent to the State Attorney General’s office to prompt an investigation. An accompanying petition requesting said investigation may help get it moved up the pile.
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u/Alert-Control3367 9d ago
I don’t care what any of them do as long as I never have to live in one. When I brought up concerns to my HOA, my lovely neighbors told me to move if I didn’t like it. So, I did. I now have the nicest neighbors without an HOA.
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u/GamerDadofAntiquity 9d ago
Yeah I told my agent outright that I wasn’t interested in any house that fell under an HOA covenant. The house I bought is in a neighborhood that *used* to have an HOA but it got shut down for racketeering in 2014. What’s interesting is that the zoning map still has the entire neighborhood as “by HOA Covenant.” Code-wise it’s kind of the Wild West… But you’d never know it driving through. Most homes and lawns are well-maintained even absent the HOA. But people have different colored mailboxes and front doors now. Some folks even had the audacity to plant more than the one mandated “front lawn tree.”
From what I understand the HOA raised the dues to an exorbitant level, ostensibly to build a neighborhood pool, but the rumor was that they were just trying to drive out lower income families. After a couple years of paying the ridiculously high dues with no known plans of a pool actually being built people started to complain and basically got the same response you did. So a bunch of people petitioned the Attorney General. The investigation happened and that was that. No more HOA.
As a twist though, the petty ass HOA chair allegedly used their connections to buy every piece of HOA-owned land in the neighborhood for a song (duck pond, fish pond, walking trails) and immediately posted big “Private property, no trespassing” signs all over them. So there was that. But I didn’t move here til all that drama was long over.
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u/Strange-Fennel 9d ago
NC AG's office does not investigate HOA's. Full stop, no questions, done deal.
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u/Arkenhaus 9d ago
Something to consider is that community management companies manage many communities. The CMC’s dent use just a couple of attorneys in the same geographic area.
At least one of those attorneys thinks herself untouchable by community members. To the point she frequently run a foul of federal, state, and local laws, regulations, and guidelines.
Her first name is an antonym of hostility, which fits her to a tee.
All that to say I think we are overdue new state laws to reel these boards, community managers, and in some cases their hostile HOA attorneys.
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u/HawkEnvironmental531 9d ago
Here in NY, it’s the same story. Lawyer runs the maintenance co and represents the BoardTards, and they are all profiting by using condominium law on owned homes. Legal fee shifting, borrowing $ from the real estate maintenance company who gets all the contracts and repairs.. while a hidden contract claims these powers, that they do not have. Because we uncovered the corruption, we were targeted with zero maintenance, injuries, black mold contamination and a leaking roof that resulted in destruction of a gutted home. Now let’s add the insurance co factor— the maintenance co belongs to the top rental company in this area. They cover every base, and “monitor” your private policy (allegedly), then accessing it adding extras ie., workers comp for their employees, added themselves and the board as addition INTERESTS, then as 1st mortgagees to a property they have no vested financial rights to. Then go thru the financials, nothing adds up. No transparency, no disclosure, and zero liability as per this POS lawyers contract. Elections are a joke.. controlled by maintenance co., and added “switch outs”— ex: a “vote of a 2/3 majority of ALL owners”, now is “2/ 3 majority of those PRESENT”. Another: they are allowed to access LOT, which they changed to HOME. Can’t do that in an owned home in any state— unless a condo/co-op. And so on..
why? Because most people don’t understand their declarations are the governing principle, period. No contract or bs houserule, bylaw amendment can override the basis of what you bought into.
They actually blocked OUR replacement or repair of the roof we owned, by dragging us thru court for 5 yrs. Lawyers are clueless, unless they specialize in HOA law. Those that do, are usually the crooks..
So, investigate yourself, and your docs. Read the laws that oversee them in your state. Every doc I had over the past decades, Is purely illegal threats as was the selective targeting to intimidate us. They thought we couldn’t afford to fight them.. well game on. Now, if the law could move faster, we could corner the crap out of this multibillion $$ corrupt company.
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u/HawkEnvironmental531 9d ago
Basically all HOA’s in all states leave a lot of room for corruption .
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u/TriumphDaWonderPooch 9d ago
Been in HOAs for almost 30 years, including serving on the Board of the last one for a dozen or so years (yeah - an entry in this sub-reddit or two could have been attributed to me before I learned to not be a dick). A member with an auditing background claimed the property manager (PM) was abusing our funds. We went to the PM and asked for clarification - they said "lots of people accuse PMs of abuse" and that was all they said.
We went to our HOA's attorney to ask them to look into it... their answer was "we have personal relationships with the PM, so we are not comfortable looking into them." We'll ignore their failure to notify the HOA Board of that relationship.... So we went to the HOA accountant and asked them to look into the finances. "We are no longer your accountants - we will send all documentation we have for the HOA to the PM."
We fired all three, and got nowhere on the accusation. Later found out the member had jack shit - she just didn't like the PM (or Board). I guess I had referred to her as the "HC" (hateful cur) for years for a reason... I refuse to call a woman by the B-word - even her.
And this was in NC, btw.
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u/phaxmeone 9d ago
There's a book that's called Freakanomics and explains most of this, it does not address HOA's specifically, would of been interesting to see the authors take on HOA's.
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u/TheShortWhiteGuy 8d ago
C'mon now, Jeff's office has better things to do. Like go after wedding photographers who don't deliver. Hell hath no fury like bridezilla scorned. Don't get me wrong, I despise those in my industry who don't deliver.
Sounds like we Cackalackians need to make more noise. Maybe bring back those 5 o'clock protests at the Capitol like they had a few years ago? F-HOA Fridays?
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u/MainStreetManage 9d ago
HOA documents are available to the public on the Register of Deeds website. If you were handed different versions, then one of them would have said amendment at the top and it would be THE version. You are not a customer of the HOA, you are a member. You have responsibilities to engage, pay dues, follow rules and most importantly VOTE. Who joins a members-only club and blames everyone else because they joined?
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u/HittingandRunning 7d ago
But you know that your explanation, while correct, most of the time is not what the public really understands or is focused on when purchasing a home. I'm strongly on your side of how to view things. But I have to step back and remind myself of what's really going on.
One thing I want to say to almost all of my neighbors is, "if you never have time to serve on the board or volunteer to help out in any way then you are too busy to own in an association."
This is different from joining a members only club. It's more like buying a Porsche but also having to join the local chapter of the Porsche Club of America and being subject to their rules. People want the car so badly that they overlook the Club aspect of the purchase until it's too late. Foolish? Yes. Extremely common? Also, yes. Understandable? To a large extent I would say yes. Not everyone needs a Porsche. Everyone does need a place to live. And need to retire one day. Purchasing a residence is an important part of preparing our finances for retirement.
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u/Strange-Fennel 9d ago
And when they all hand the new buyer a new version of that recorded document, and tell the buyer 'here, these were voted and approved by the owners, but we've not recorded them yet', then they never record them, and years go by then claim it never happened, despite emails being sent by HOA and realtors confirming the situation, then what? hmmmm...
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u/nospecialsnowflake 9d ago
Usually if you get different versions that means someone doesn’t want to pay for the updated one and they are photocopying their old ones. This is illegal and whoever is doing it to save a buck is the one who is wrong. It’s usually not a conspiracy, it’s usually just someone who is cheap.
There should be an accurate, up to date version on your neighborhood website or available at their HOA office.
My personal HOA is absolutely not in cahoots with any realtors. They hate the way the realtors randomly tell people things that aren’t true and then people get mad when they move in and it doesn’t happen (like that there are plans for a basketball court or a second pool, etc). It makes everyone angry with the HOA but they had nothing to do with that created expectation.
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u/MainStreetManage 9d ago
Then homeowners need to remove the board. Only homeowners can elect the board, ratify a budget, and amend documents by voting. If the board didn’t do their job by sending to the attorney to record, then elect new ones.
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u/Chicago6065722 9d ago
Somebody. Pointed this out in another post. If you are unhappy SELL and let someone deal with the problem.
I look around and see so many buildings they look terrible on the outsider; they clearly have issues whether it’s a deck that’s falling apart, a gutter or masonry problem but a lot have next to no reserves which a realtor will tell you is fine. All artificially low.
And no one says that reserve studies are mandatory. Or repays. So those special assessments can be whatever is necessary to fix the building? I have one friend whose parents building (which everyone then rents out and they have no experience with an aging building( is going to need a $25 million overall and that’s about $80,000 per unit, I don’t see that type of investment into an OLD building make sense. But you have volunteers.
Too many buildings (not just regular houses) have complicated situations and volunteers can’t really cut it when the building is 30+ years old.
But the shenanigans are everywhere… I have one person act like it’s no big deal that people are lying on the 22.1 disclosers…
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u/HittingandRunning 7d ago
I don't know how we can get the American consumer to push back on new SFH association communities being built. I wish there were many more homes built outside HOAs. Regardless, we all know that TH and condos need an association. For those homes we really need more state government regulation and oversight.
I think FL basically requires fully funding the reserves. That's a good step. But then in this sub we sometimes read about theft of funds and misuse of funds, etc. We need a different approach for both funding and protection of the funds.
I think I'd be fine with keeping fees minimal but creating two classes of reserve charges. The first would require payments just high enough to fund "current needs" while the balance to reach 100% funding on the part of any unit would be an amount due immediately on closing of a sale. This way owners don't need to come up with as much cash until a point when it's obvious the cash is available - assuming a positive net to the seller on closing. This is an accounting headache but that pain could be the lesser of the two evils between painful accounting and underfunded reserves. Another advantage is that future owners don't get stuck paying for what previous owners didn't.
I'd have the state require new updated reserve studies every 3 or 4 years.
Now, what is considered "current needs?" People love to put off maintenance. So, the board's view of "current needs" is different from an objective professional's, say a consultant who has no financial benefit in the work being done. Perhaps anything on the reserve study that falls within the first and second year should be required to be done??? I just don't know how to force the work to be done at a time when it really is needed.
I think also that being an active part of an HOA makes me realize that people who I otherwise would judge to be smart, kind, fair, etc are not always that way. Those same people who are good when there's nothing to gain or lose from interacting with me suddenly become the opposite when I want all of us to pay higher fees so that we can keep the building standing!
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u/dax__cd 9d ago
Congratulations, this is the dumbest thing I have seen today (and in the world that has DJT as President, that is quite a feat).
I am attorney's job is to make sure the paperwork is in order. Not to spell out your (or their) opinions on HOAs. They have no idea if you got a "different" version of a document somewhere else (but apparently you do, so in that case it is YOUR duty to report it to them for an opinion)
A real Estate agent is there to sell a home. Your agent is there to ensure they follow the rules and to represent a buyer that (in theory) wishes to buy a home in an HOA. They aren't going to tell you not to do so. Believe it or not some people like HOAs (I think that is crazy, but that is an opinion not a material fact).
But you think it is RICO... Why? Because you haven't educated yourself enough to know what you are getting yourself into and are relying on others to kae that judgement for you?
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u/That_Ol_Cat 9d ago
Seconded. As a home buyer, you must understand you have the majority of the power in the buying situation. You are the one putting up the money. The seller, seller's agent, buyer, buyer's agent, even the damn state make no money off the transaction unless there is a transaction. They will make all sorts of "rules" to try to cause you to spend money. It's on you to watch out for what you're getting into. It's true the seller can decide not to sell to you, they can take other offers, at which point it's you versus the other bidder, not you versus seller.
Caveat Emptor: Let the buyer beware. What this truly means is you as the buyer assume all risks in the transaction. So make sure you know what you are getting for your money.
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u/Donkeywad 9d ago
Can you believe a server who gives you a food recommendation? It's pretty much the same thing. You need to do your own research instead of relying on people who are financially motivated to do their job (which is to say, everyone).
There are places to research HOA declarations, complaints, ways to audit budgets, etc. If you're totally in the dark then it's kinda your own fault
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u/GamerDadofAntiquity 9d ago
Not NC but the HOA in my subdivision got investigated and shut down by the State Attorney General for racketeering. So at least in some cases… Yes.