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Condo Homeowners Association Fee: What Does it Cover?



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By : Andy Asbury    99 or more times read
If you live in a condo, or even looked into living in one, you probably have seen the letters HOA. They stand for Homeowners Association. And likely somewhere near those three letters, you saw a dollar sign with a number behind it. That number, which could range from $100 to $1,000 or more, represents the monthly dues owed to the condo homeowners association.

Your monthly condo HOA dues are not part of your mortgage, but are instead a direct and separate payment to the homeowners association, which uses them in a variety of ways. Before purchasing a condo, itís important to know what your monthly HOA payment covers and what it doesnít cover. Keep in mind that not all associations cover the same things.

Following are some things that may be covered by your monthly payment:


Public areas

The public areas in your condo building need regular upkeep and maintenance to keep them operating well and looking good. That includes such things as mowing the grass, removing snow, changing light bulbs in common areas, and keeping the hallways clean. If your building has amenities like a fitness room or pool, part of your monthly payment will go toward maintaining them, too.


Garbage, sewer and water

Itís quite likely the homeowners association will contract with companies who provide these. While you wonít have a monthly bill for garbage, sewer or water, youíll pay for the services in your monthly HOA payment.


Insurance

There will be some sort of insurance policy that your homeowners association carries, but you should be sure youíre clear about exactly what it covers. It will cover the outside of the building, but how much coverage you have inside your unit depends on the individual policy. Talk with your insurance agent about getting an HO-6 policy, which is known as insurance for condominium owners. Youíll want to include on that policy anything not covered by the associationís policy. Examples of items to include are clothing, electronics, furniture, and jewelry. The policy likely also will include liability insurance.


Reserve funds

A small portion of your monthly association payment should go into a reserve fund that can be tapped for major expenses. If your association doesnít have adequate reserves but has a big bill to pay, itís likely youíll receive a special assessment to help cover that cost.


A note about the association

Some association boards of directors include all condo owners, but in many cases the building is simply too big and instead a board is elected to make decisions on all residentsí behalf. You can give input to the board by going to its regular meetings, or by talking to members when the need arises. If thereís something you are not happy about, or want to see changed, consider running for the board yourself. Itís a great way to effect change in your building, and to meet new people.
Twin Cities writer and REALTORģ, Andy Asbury focuses his team of lofts and condos Realtors on Minneapolis condos and lofts. Find Minneapolis condominiums online at www.MinnesotaLoftsandCondos.com today!

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