Regular reserve studies are crucial to keeping your community’s finances healthy and avoiding legal disputes as a homeowner’s association (HOA) or property owners’ association (POA). This post will guide you through why reserve studies matter and what to do if a dispute arises.
What are reserve studies?
A reserve study is a detailed analysis that helps your association plan for the future. It checks the state and life span of significant property components such as roofs, pools and elevators. The main goals of a reserve study are to:
- Inventory assets: Find all common area parts and guess how long they’ll last.
- Assess financial health: Evaluate the current reserve fund’s strength against future costs.
- Create a funding plan: Make a plan for reserve payments to ensure funds are there when needed.
By doing regular reserve studies, you can avoid unexpected financial problems and keep your association in good shape.
Importance of reserve studies
In Texas, HOAs and POAs must conduct reserve studies to comply with state laws and avoid legal trouble. Not doing these studies can lead to hefty, unfair special assessments, causing disputes among homeowners. Regular reserve studies help you comply with the Texas Property Code and ensure your association’s financial stability.
What to do in case of a dispute
Even with your best efforts, disputes may still happen. Here are steps you can take to solve them:
- Document everything: Keep detailed records of all communications, payments and maintenance activities.
- Understand your governing documents: Know your association’s bylaws, CC&Rs, and the Texas Property Code.
- Request relevant records: Get the necessary documents to support your case.
- Consider third-party assessment: Ask an outside expert for an unbiased evaluation.
- Attempt informal resolution: Talk directly with the people involved to reach an agreement.
- Consider legal advice: Consult a lawyer experienced in HOA or POA disputes if informal resolution fails.
By following these steps, you can handle disputes better and keep peace in your community.
Regular reserve studies and active dispute resolution are vital for running your HOA or POA smoothly. Stay informed, follow the rules and help your community thrive.