MCQ Flashcards

A homeowner in a planned community fails to pay assessments for six months. Under most state statutes, what is the association's strongest enforcement tool?

Answer: Place a lien on the property

Associations typically have statutory authority to place a lien on a delinquent owner's property, which can lead to foreclosure if unpaid.

When preparing the annual budget for a community association, which document helps determine the amount to fund the reserve account?

Answer: A reserve study

A reserve study analyzes the community's major components, their remaining useful life, and the funding needed to repair or replace them.

A board member wants to vote on a contract that will benefit a company she owns. What governance principle applies?

Answer: Conflict of interest

A conflict of interest exists when a board member has a personal financial stake in a matter being decided by the board.

Under the Fair Housing Act, which of the following is a protected class when enforcing community association rules?

Answer: Familial status

Familial status is one of the seven protected classes under the Federal Fair Housing Act, protecting households with children under 18.

An association's governing documents are silent on a particular issue. What is the correct order of authority to consult?

Answer: Declaration, bylaws, rules, state law

The hierarchy goes from the broadest governing document (declaration/CC&Rs) down through bylaws, rules, then state law fills any gaps.

Which type of insurance covers the association if a visitor slips and falls on common area property?

Answer: Commercial general liability

Commercial general liability (CGL) insurance covers third-party bodily injury and property damage claims occurring on association property.

A community manager receives a written request from an owner to inspect the association's financial records. Under most state laws, this request must be honored within:

Answer: 10 business days

Most state statutes require associations to make financial records available to members within 10 business days of a written request.