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What you need to know before you buy into a condo association

(Patrick T. Fallon/BLOOMBERG)

Jill Chodorov, an associate broker with Long & Foster, writes an occasional column about local market trends and housing issues.

If you’re thinking about buying a condo, townhouse or single-family house in a community with an association, you might want to do more than check out the size of the bedrooms and the finishes on the counters. You also might want to examine the association’s board minutes.

This is the best way to learn how financially stable the board is and to prevent yourself from getting into some unforeseen problems in the future.

In a recent transaction in which I was representing a buyer on the purchase of a foreclosed condo, I requested from the association to review the last 12 months of association meeting minutes.

I was unfamiliar with details about the condo development in North Bethesda.  Because it was a foreclosure sale and the bank was not providing property disclosures, I asked for additional information about the development above and beyond the information required by law to be provided to a buyer.

My request was denied.

According to the Maryland Condominium Act, buyers purchasing in a Maryland association are afforded an automatic seven-day contingency to review association documents and can back out of the transaction for any reason during the contingency period.

The seller of a property in an association is required to provide the buyer with a copy of the association declaration, a copy of the bylaws, a copy of the rules and regulations and various other disclosures.

The documents that must be shared with a buyer, as stipulated in the Maryland Condo Act, do not include the meeting minutes.  Paragraph 11.116 of the Maryland Condo Act states that associations are responsible for providing copies of financial statements and meeting minutes to current unit owners only.

So why was I interested in reviewing the meeting minutes on a development?

The meeting minutes provide a more intimate perspective on current issues within the development.  You can identify any conflicts that regularly stew among neighbors.  You can learn about upcoming major expenditures and potential plans to assess owners to cover costs.  You can find out how active and diligent owners and board members are in running the business of the association.

“If I was a buyer, I would want to see the minutes,” said Thomas Schild of Thomas Schild Law Group in Rockville, an expert in community associations.  “The minutes can give insight into how an association operates.”

“The best time to request the minutes is before you submit an offer,” Schild added.  “You may not get them once you have ratified a contract.”

In D.C., buyers are offered an automatic five-day document review contingency. In Virginia, buyers who are purchasing a resale property are provided an automatic contingency to review association documents — three days for condos and five days for townhouses and single-family houses.

In these jurisdictions, meeting minutes also are not required to be provided to the buyer.

“I think it should be standard for the resale package to include meeting minutes from the past year and copies of all correspondence from the board to the owners,” said Carl G. Becker, principal broker of Premier Properties.

“I’ve never experienced this, but what a great idea,” said Cindy Moses, associate broker of Keller Williams Flagship of Maryland. “I’m living in an HOA for the first time in my life and the politics have been a real eye-opener. It might be a good idea to attend a board meeting, as well, if time permits.”

A board member of the association told me in a phone call that associations do not want to provide any more information than required by law.  The board member also said that they do not want private details about the association to be distributed to individuals who may end up not going through with the purchase.

In the recent transaction with my buyer, I was able to obtain further details about the association by speaking with the property management firm and the board member.  The information gathered was sufficient for my client and he moved forward with the purchase.

Here’s what you should do when purchasing in a homeowners or condo association:

Ask to review the meeting minutes prior to making an offer.

• Don’t be shy about approaching current residents on evenings or weekends to ask them about their satisfaction with the development.

• Ask about upcoming expenditures and how those costs will be covered.

• Find out about rules and regulations that you may not be able to live with, such as a no pet policy.

• Find out how long the property management firm has serviced the development (if the association moves through management firms as often as it pays the water bill, there may be some instability brewing).

• Find out how much money is in the reserve fund to cover costs and repairs.

With some careful research, you can be more confident that you are purchasing a property in a financially stable and well-managed community.

Previously from Jill Chodorov:

New program may offer hope to low- and moderate-income homebuyers

Virginia parts ways with D.C. and Maryland on uniform sales contract

Assessing your real estate agent’s credentials

What buyers and sellers can do in a slow market

Should you list or buy a home in the summer?

In tight market, pre-listing sites becoming popular

High radon levels may be downside to having a tight, energy-efficient house

Logan Circle condos to use feng shui

How to find affordable housing for an elderly parent

Jill Chodorov can be reached at