Homeowners’ associations are not overly popular in Michigan and are not governed or regulated by any state act. Condominium laws are described in the Condominium Act and the Condominium Administrative Rules, but neither of which directly apply to HOAs. For a homeowners’ association to be a valid legal entity, it must be organized as a corporation. The Nonprofit Corporation Act describes all regulations regarding association administration but does not limit the powers of an HOA.
Because there are no formal regulations HOAs must follow, every association will be different. When a homeowners’ association applies for corporation status, they must submit the Articles of Incorporation and Bylaws that the community will follow. These documents become the rules that the board of directors and homeowners must obey. Community associations have the freedom to create and enforce as many or as few regulations as they desire so long as they do not contradict any local or state laws.
Homeowners Association’s Rights and Responsibilities
According to the corporation act, the board of directors must contain at least three members. Directors are elected by the homeowners at the annual member meeting. Homeowners have the power to remove a director for any reason with a majority vote unless it is otherwise stated in the community bylaws.
Amendments can be made to community regulations with a majority vote from the board of directors. Approval from homeowners is not required unless it is stated in community bylaws. Any changes to the Articles of Incorporation or the bylaws must be documented in the county in which the community is located.
The homeowners’ association has the power to collect regular assessments from homeowners as described in community documents. If an account becomes past due, the HOA can place a lien on the property and charge any reasonable legal fees back to the homeowner.
The board of directors may call meetings to discuss community matters. These meetings may be open to all association members unless otherwise stated in community bylaws. Closed meetings are allowed to discuss sensitive matters such as impending litigation or specific account details. Notice for meetings is not necessarily required.
Homeowners have the power to elect and remove members from the board of directors at any member meeting. Member meetings must be held at least annually or more frequently as described by community regulations. To remove a member of the board of directors, at least a majority vote is required. Community bylaws may require a larger percentage.
Any association member can request to view any community documents including the budget and financial information. It is the responsibility of the board to provide the requested documentation in a reasonable time. The board of directors can deny any request to view community documents if there is reasonable cause unless it is otherwise stated in community regulations.
Community Association Law in MI
HOA rules in Michigan vary widely. It is important to read and understand all community regulations before purchasing property in an HOA-managed community. Most homeowners’ associations require the signing of a contract upon purchase.
To ensure that your community association is being run following all state and local laws, it helps to have a professional on your side. CSM has a team of experienced professionals that have worked with communities in almost every state in the US. Specializing in HOA financial management, we can help your board of directors manage association finances, write and submit documents, and prepare for audits. If you have any questions regarding state HOA laws and regulations, give us a call at (865) 315-7505, contact us online or email us at firstname.lastname@example.org.