Planned Unit Development (PUD) Rider
REM #A746
By Ilyce R. Glink
Summary: A ThinkGlink reader purchased a home in a planned subdivision that did not have a homeowners' association (HOA) but she signed a planned unit development rider on her mortgage. Now an HOA has been formed and they sent a letter saying she is behind in her dues. Ilyce explains that if there is an association, she needs to pay the dues and should receive some benefits.
Q: My parents live in a subdivision that didn't have a homeowners’ association
(HOA) when they first moved there in 1998.
They did sign a PUD rider though. A year ago, they received a letter saying that they are behind in HOA dues.
They have never committed to being in an HOA or attended any meetings. Since they signed the PUD, are they obligated to pay the homeowner's dues? Thanks!
A: Let me start by saying that your parents really need to talk to a real estate attorney about this issue.
You say they signed a PUD rider. Was that in connection with a loan they obtained? A PUD rider is a document that is attached to a mortgage and refers to a “planned unit development.” It would appear that when they signed the PUD rider, the lender may have known from the title report that the property was subject to some sort of association or other community living arrangement.
If in fact they live in a subdivision or community that is impacted by association
rules and dues, then yes, they must contribute their monthly assessment. In
return, they should benefit from having the association manage the common areas
of the development.
But surely, the letter stating that they are "behind" in their assessments
isn't the first one that they received. There must have been other communications
with the association.
They should know that choosing not to participate doesn’t mean you get
to opt out of belonging to the HOA. For legal options, your parents should speak
to a litigator with experience in real estate law.
NOTE: This column is distributed by Real Estate Matters Syndicate, PO Box 366, Glencoe, Illinois, 60022. This column may not be resold, reprinted, resyndicated or redistributed without written permission from the publisher.
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