HOA Transition Checklist (Free Template)

When the time comes to transition from developer-controlled association to an HOA which is resident-controlled, sometimes people will focus only on the benefits of doing so. While there are certainly benefits to take pride in, the future HOA board treasurer or any other member shouldn't look past the process of getting to that point, as it's not necessarily the easiest thing in the world.

Any HOA management company will tell you to make sure that you have a checklist, and there is a good reason for that. With so many moving parts, it's not hard to miss something by accident.

With that said, let's take a look at the intricacies of the process and what you can do to make the change to a community association that much easier.

Download A FREE HOA Transition Checklist Here!

Looking for an easy-to-follow transition checklist? Download yours here for free!

Roles in the Transition

When it's time for the developer to turn over control to the residents, there are a couple of key roles that need to be mentioned in the process, and these are outlined at a high level below.

The Board Members

The homeowners association will be run by a board of directors who will have quite the responsibility ahead of it. The expectation is that community associations will receive all the information they will need from the developer to begin to run the unit optimally.

Here, the expectation is that the HOA board members will properly review the information presented and ensure that any queries or areas of clarification are taken care of. Additionally, it's time to get into strategic mode and plan.

The Developer

Developers handle the whole process in different ways, but the best ones will try to achieve the best outcome by ensuring that homeowners are involved and trained from the initial stages. To this end, there should even be advisory committees being set up for the cause.

Following all of this, a special meeting will take place, which effectively serves as the turnover, which means that the developer is no longer required to have any duties of control.

Nevertheless, it's not uncommon for them to still be somewhat involved through the sale of units, for example. In any case, once the official developer turnover process is complete, the control now rests with the board.

What Kinds of Issues May Come up in the Transition Process?

Now that you know about the responsibilities of the two major parties, what about the challenges that can arise as a part of the transition process?

Governance

Though the process was simplified above for understanding, there will usually be a slow changing of the guard. This is done to allow the new board the required time to grasp the situation and ensure that any required audits are taken care of. Some state laws will even impose regulations on when this turnover is expected to happen.

Documentation

Governing documents and community associations go hand in hand. These are HOA rules that will align with both laws and the needs of the community. Articles of incorporation, Declaration of covenants, conditions, & restrictions (CC&Rs), as well as bylaws are examples of some of these areas of documentation.

The recommendation is that these are drafted by board committees in the shortest possible order. Depending on the location, local governments may wish to check them. Additionally, they need to be audited. Should you choose to hire a professional HOA management company, they will also need to take a look at these, which explains why it's essential to get them out of the way.

Construction

Developers are meant to ensure that the HOA is built. Of course, construction being an essential puzzle piece to an HOA goes without saying. The board is supposed to ensure that the construction quality is up to the standard expected since builders usually want to wrap things up as quickly as possible to maximize the extent to which they can profit.

Tension will sometimes pop up because of all this, so much so that some builders will bring in consultants just to lower the amount of work they must do.

What Are Some Typical Checklist Areas

Downloading our free checklist above will ensure that you cover all the required bases. Nevertheless, you may wonder what some of the typical elements of a turnover checklist are. They are highlighted below for easy reference.

General Documents

Finance and general documentation are essential. The developer will hand over critical documentation such as financial statements, active insurance policies, service and employment contracts, and owner contact information to the HOA.

These are to be reviewed. You want to ensure that the community's financial health is in good standing for example. Maybe this may mean ensuring that contracts match contractor fees.

An audit is a good idea here with the approval stage coming once the board has been satisfied with what has been provided.

Inspection

While inspection of the documents will take place with a fine-toothed comb in the above step, this one speaks to a property inspection. Here, you will want to ensure that there is an engineer hired for this step.

The property inspection should usually be covered by a good maintenance checklist. With the inspection completed, the details raised should be sufficiently recorded.

Sure, the hope is to be able to say that everything looks good but that will not always be the case. What if something significant pops up that you will need to take up with the developer?

Ensure that you record your concerns clearly and in detail. With this, you can pass through the approval stage of the property inspection.

Legalities

There are no two ways about the legal side of things. Ensure that you hire a professional attorney. Legal counsel is always advised as these persons will have a working understanding of the litigation and other policies that may apply to your context.

The first order of business is to ensure that you are remaining in compliance with state law. An HOA attorney will be properly equipped to verify this. There are a lot of laws floating around and knowing which ones and how they apply to your state is essential. Even if you don't initially understand, you can trust that the lawyer will do the due diligence to ensure that you are falling in line.

CC&Rs were mentioned above and here they are again. This is the highest level of documentation that a homeowners association can have. To put it into perspective, only the actual local, state, and federal laws are any higher.

You will want the legal counsel to read through them along with you to ensure that they are appropriate and that they can be enforced. After all, with time, new concerns emerge and some old concerns become obsolete.

The Board

The board members have been mentioned several times before, and it stands to reason considering that this is the governing body of the HOA that will make many important decisions that should be in the best interest of all who are a part of the homeowners association.

It's essential to have an election to ensure that the members are selected fairly. Usually, there will be bylaws that speak to how the initial directors are chosen and how any subsequent elections will take place.

With the election piece out of the way, committees need to be established. This will start with the creation of an annual budget and what will be allocated to each committee. Some of the common committee types are financial, architectural control, safety, and communication.

The Finishing Touches

The final thing to do here is to ensure that all of the expected documents have been received from the developer as well as when the follow-up turnover meeting will be happening.

Why Do You Need an HOA Transition Checklist?

Much of it boils down to organization. There are a lot of variables that go into the process and being able to streamline them will never not be beneficial. You're juggling board members, vendors, the developer, and third-party professionals such as engineers or attorneys.

Additionally, there's going to be a lot of information flowing throughout the process and don't forget that there may need to be remediations of identified issues.

All of this is capped off by a planning process because the future of the HOA is still essential. That's why you need the right tools to get through it. Ensure that you download our HOA transition checklist to make it as smooth as possible.

Useful Transitional Tips

Here are a few useful tips that should make the transition process that much better:

1. Hold transition meetings regularly enough at the onset since there will be a lot to discuss, plan, and execute
2. Ensure that you seek to obtain and stay on top of all current maintenance records. Remember that the board needs to demonstrate the board's upholding of requirements.
3. Look at all the contracts that the developer may have entered into and make adjustments based on what is necessary
4. Maintain a clear sense of the HOA's financial position.

HOA Software Can Make Your Life Easier Too!

The transition process is difficult, but thankfully, the running of the HOA doesn't have to be. Take advantage of DoorLoop's proprietary HOA software solution complete with:

1. Automatic payments of rent, maintenance, dues, and fines
2. Comprehensive accounting tools complete with bank account and Quickbooks integrations
3. Accounting and AR/RP reports
4. Unlimited administrative accounts
5. Architectural and maintenance request handling
6. Custom website with a resident portal included
7. Easy communication via email, phone, text, or portal messages.

The Final Word

The transition process can be complicated and if you allow it to get away from you, expect a difficult time ahead. Ensure that you use our transition checklist to keep things organized and flowing smoothly.

Additionally, schedule your free demo of our incredible HOA software solution today!