The Purchase Of A New Home Is Always An Exciting Time.
Successfully Transition from Developer To Ownership Control
We can help your community to ensure that the transition of control from the developer to the owners is as seamless as possible.
When Should The Board Transition From The Developer To The Owners?
Most Associations have a timeframe for developer transitions specified within the declaration or bylaws. Some documents may state that the original declarant still has architectural review authority until the last lot or unit sells.
- Condominium Transitions are Governed by Statute
- Generally, the maximum time for a condominium transition from the developer to the owners is five years. This timeframe may shorten based upon when percentages of units sell.
- Planned Unit Developments (aka HOA) Must Transition After Declarant Ownership Ends
- The Planned Unit Development Act requires that the board transition from the declarant to the membership at the time the last sublot is sold. However, many developments have shorter timeframes prescribed within the declaration or bylaws.
What Steps Should The Owners Take After Transition?
- Ensure that the Association’s Finances are in Order
- Once the owners take control of the Association it is important to look at the finances. Ensure all financial records are present by hiring a professional accountant to review them once received.
- Take a Close Look at the Budget
- At times, developers keep maintenance fees low to help draw in potential buyers. The ownership needs to look at the current expenses and future projected capital maintenance to ensure that the Association is sufficiently budgeting for the operating and reserve accounts.
Contact Us To Discuss How We Can Help Your Association Effectuate A Seamless Transition From The Developer
Our experienced team of attorneys and legal staff, and in-house title company are here to help assist the owners and the association in the turnover process. This is a unique area of the law, and it is important to have legal counsel familiar with the pitfalls of transitions.
Contact us to discuss how our attorneys experience with the transition process can help your community.