Question:
I have been living in my HOA since October 2023. Brown Homes has been a developer in this HOA for years. Brown Homes is now ceasing development and will be leaving. The HOA is now facing repayment of a loan Brown Homes gave the HOA back in 2020 of about $200K. Us residents have been asking for the loan docs to see the terms of the loan with no luck. Mike Brown of Brown Homes is also listed as a principal on the AZ Secretary of State for the HOA. How can we get a copy of the loan? Is it legal for the developer, Brown Homes, to also be the controlling Board to the HOA and essentially give himself a loan through the HOA?
– Lisa
Answer:
Hi Lisa,
According to the Arizona Planned Communities Act Section 33-1805(A), all financial and other records should be reasonably available to members. The member must make a written request to inspect the records. The association will have 10 business days to comply with the inspection or produce copies.
Kindly raise this with the HOA board and developer so they may provide you with a copy of the contract. You may also request to review the association’s financial records to verify how the loan was used. As for the contract itself, developers usually have the right to execute contracts on behalf of the HOA while it’s under developer control. These contracts are usually executed to operate the HOA and fulfill development obligations. For further guidance, kindly consult a lawyer.
Disclaimer: We are not lawyers. The information provided on this website does not constitute legal advice.
