New Law Aims to Help Common Interest Home Owners
Purchasing property in a “common interest” development, defined as condominiums, cooperatives, townhouses--developments governed by a Home Owner’s Association (HOA)--can be stressful due to the horror stories sometimes associated with dealing with HOA's which can be daunting enough to discourage some buyers from going the condominium route altogether.
A few of those stories are featured on the Professorbaron.com blogspot.
Take for instance the one about a couple who didn’t read the condominium board meeting minutes about an $850,000 construction defect on the common property that needed repairing and would cost each condo owner nearly $7,500 in special assessments. Yup, it was noted extensively for months before this couple purchased, but they didn’t read the stack of documents related to their purchase that they received prior to closing. So they were not aware of the assessment until the first board meeting — three days after they closed.
Or, what about the incident that involves a buyer whose HOA fees began to exceed his mortgage payment. He lived in a restricted-income unit, so the price was low and affordable. However, a couple of years in, the older building needed capital repairs, such as a roof and elevator. HOA fees skyrocketed, and as a result, his assessment fees were more than his mortgage payment.
A new bill signed into law by Ill. Gov. Pat Quinn, House Bill 4202, sponsored by Ill. State Representatives, Elaine Nekritz (Dist.-57th) and State Senator Heather Steans (Dist.7th), creates the Condominium and Common Interest Community Ombudsperson Act which establishes an Ombudsperson within the Department of Financial and Professional Regulation. This new position will provide dispute resolution assistance on behalf of condominium unit owners.
“This new law will give condominium unit owners alternatives to litigation as they work to resolve disputes,” Governor Quinn said. “By helping prevent potentially expensive litigation the Condominium Ombudsperson can help keep costs down for property owners throughout Illinois.”
The new legislation, effective beginning July 2016, creates a position within the Illinois Department of Financial and Professional Regulation to help resolve disputes and to educate condominium owners.
House Bill 4204, sponsored by State Representatives Elaine Nekritz (D-Northbrook) and State Senator Heather Steans (D-Chicago), creates the Condominium and Common Interest Community Ombudsperson Act which establishes an Ombudsperson within the Department of Financial and Professional Regulation. This new position will provide dispute resolution assistance on behalf of condominium unit owners.
"The rights and responsibilities of condo owners and associations can be complex, so I'm pleased that Illinois will follow the lead of four other states whose residents are able to enlist the assistance of a condominium ombudsperson in resolving conflicts," Senator Steans said. "Educating the public with dispute resolution when requested will help prevent unnecessary and expensive litigation."
The new office will also provide educational materials on a website that are relevant to condominiums and common interest communities. Additionally, condominium associations must have a written policy for resolving disputes and be registered with the Department of Financial and Professional Regulation.
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