What Is an HOA Review Contingency in Real Estate?
An HOA Review Contingency (also called an HOA document review contingency) gives buyers time to review a homeowners association’s governing documents, rules, financials, fees, and upcoming assessments. If the buyer finds anything unacceptable, they may cancel the contract without penalty during the review period.
✅ How an HOA Review Contingency Works
- The seller or HOA provides required documents (CC&Rs, bylaws, budgets, rules).
- The buyer receives a set number of days to review the packet.
- If the buyer disapproves of the HOA terms, they may cancel the contract.
- No penalties apply if cancellation occurs within the contingency period.
- If accepted, the contingency is removed and the contract moves forward.
This contingency protects buyers from unexpected restrictions, fees, or financial problems within the HOA.
📄 What Buyers Review in HOA Documents
- Bylaws and CC&Rs (Covenants, Conditions & Restrictions)
- Budget & reserve funds
- Monthly dues and upcoming fee increases
- Special assessments (current or proposed)
- Rules & regulations such as rentals, pets, parking, renovations
- HOA litigation involving the community
- Insurance coverage and maintenance responsibilities
These documents help buyers understand the HOA’s financial health and lifestyle restrictions before committing to the purchase.
💡 Why HOA Review Contingencies Matter
- Protects buyers from unexpected financial obligations.
- Prevents surprises like pet restrictions or rental bans.
- Reveals HOA stability through budgets, reserves, and meeting minutes.
- Gives sellers confidence that buyers are fully informed.
- Essential in condos, townhomes, and planned communities.
⚠️ Risks & Considerations
- Seller delay in providing documents can extend the timeline.
- Buyers may cancel for any reason related to HOA rules or finances.
- Strong HOAs may require buyer approval—review all requirements.
- Budget or reserve shortages may indicate upcoming assessments.
- Some HOA rules may limit short-term rentals, pets, vehicles, or renovations.
