When it comes to buying and selling real estate, association documents are a crucial component that often gets overlooked. These documents provide prospective buyers with valuable information about the property and the community in which it`s located. But what is true about association documents in the residential contract to buy and sell real estate? Let`s take a closer look.

Association documents are typically provided by the seller and include a variety of information related to the homeowner`s association (HOA), if applicable. These documents can include the HOA`s bylaws, covenants, conditions, and restrictions (CC&Rs), and financial statements. They may also provide information about any upcoming special assessments or pending litigation involving the HOA.

One important thing to note is that association documents are typically considered “disclosures” under state and federal laws. This means that sellers are required to provide these documents to prospective buyers, and buyers have a right to review them before making an offer or signing a contract.

Buyers should carefully review the association documents to ensure that they understand all of the rules and regulations that apply to the community. For example, the CC&Rs may include restrictions on the use of the property, such as limits on the number of pets allowed or requirements for maintaining a certain level of landscaping. Buyers should also pay close attention to any special assessments that are due or pending, as these can impact the cost of owning the property.

Additionally, buyers should review the financial statements to ensure that the HOA is financially stable and has sufficient reserves to cover unexpected expenses. A poorly managed HOA can lead to increased fees or even foreclosure in extreme cases.

In summary, association documents are an essential part of the residential contract to buy and sell real estate. Buyers should carefully review these documents to understand the rules and regulations of the community, any upcoming assessments or pending litigation, and the financial health of the HOA. By doing so, buyers can make an informed decision about whether to move forward with the purchase of the property.