The Loftin Firm, P.C.
Legal Question? We can help.
Call 760-814-9649

Alert: New Law on HOA Reserves

HOA Reserves under the Davis-Stirling Act may be impacted by the enactment of Assembly Bill 968, which amends California Civil Code Section 4775. AB 968 changes the responsibility for exclusive use common areas. The current law under the Davis-Stirling Act effective until December 31, 2017 excludes exclusive use areas from the association's maintenance, repair and replacement responsibilities and places that responsibility on the owner of the separate interest for maintaining any exclusive use area attached to the separate interest. The new law, in effect on January 1, 2017, reverses the responsibility requiring, generally, that if the HOA's governing documents and/or CC&Rs are not clear on who is responsible for exclusive use common areas, then it is the HOA' s responsibility.

The impact on the operating costs and reserves can negatively impact the financial health of your HOA. How? Depending upon the governing documents, the HOA may be liable for extensive maintenance, repairs, and replacements previously borne by the individual owners and not part of the HOA budget. What can you do? The first step is to review your governing documents.  The second step would be to amend and/or restate your governing documents to avoid this potential, financial pitfall.

L. Sue Loftin is the Founder and Shareholder of The Loftin Firm. For questions relating to this blog or any other California real estate, corporate governance, land use, or estate planning matter, contact Ms. Loftin at (760) 814-9649 

No Comments

Leave a comment
Comment Information
Email Us For A Response

Contact Us

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Leading You Down the Path to Sucessful Legal Solutions
The Loftin Firm, P.C.

The Loftin Firm, P.C.
5760 Fleet Street
Suite 110
Carlsbad, California 92008-4713

Toll Free: 866-933-2340
Phone: 760-814-9649
Fax: 760-431-2003
Map & Directions

map