Guidance for The Movement in the Real Estate Market

Vocabulary

Definition and Vocabulary for Owner's Associations:

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Articles of Incorporation:
Creation of the legal entity that each member owning a unit in the complex will become a member of. The articles are filed with the Secretary of the state and the entity is typically a non-profit mutual benefit corporation.

Assessment:
Also referred to as Owners Association dues. Shall mean and refer to monthly payment by each member for the cost of maintaining, improving, repairing, operating, and managing the property. Each member’s monthly payment amounts are determined by the Association’s Annual budget and the ownership interest of each owner.

Association Bylaws:
Shall mean and refer to the Bylaws of the Association, and filed with the Secretary of the State. Association Bylaws may be amended from time to time.

Board of Directors:
Shall mean and refer to the governing body of the Association. Board members are elected on a bi annual basis and include four positions: President, Vice President, Secretary, and Chief Financial Officer.

Common Area:
Shall mean and refer to the entire project, including, without limitations, the land within the project, the parking, driveway areas, the landscape, open areas, utility closets, roof, roof structures, and elements, exterior walls, bearing and structural walls, janitorial closets, and common area hallways and bathrooms. Excludes the area located within the walls of the unit(s).

Common Interest:
the proportionate undivided interest in the common area that is part of each condominium interest as set forth in the project Declarations.

Condominium:
Shall mean an estate in real property as defined in California Civil code, consisting of separate interest in a unit and undivided interest in the common area and other rights appurtenant to the unit as set for in the project Declarations.

Covenants, Condition, and Restrictions (CC&Rs):
Also referred as Declarations. They are the limitations, covenants, conditions, and restrictions, and easements, all of which are imposed as equitable servitude pursuant to the general plan for the development for the purpose of enhancing and protecting the value and attractiveness of the of the project. All limitations, covenants, conditions, restrictions, and easements shall constitute covenants that run with the land and are upon all members of the Association.

Member:
Also referred to as Owner, shall mean and refer to a person entitled to membership in the Association and are bound by the project Declarations, Bylaws, and Condominium Plan.

Reserves for replacement:
As part of the monthly Assessments, the Board of Directors, shall annually fix the amount to be contributed pro rata by each member to the Reserve Funds. Reserve Funds may not be expended for any purpose other than repairing, replacing, or adding to the major improvements of the property.

Reserve Analysis Report:
Also referred to as the Reserve Study: Provides a “Financial blueprint” for the future of the Association. An accurate reserve analysis and a “healthy” reserve fund are essential to protect and maintain the Association’s common areas and property values of the individual Unit owners.