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Check The Box?

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PushinValue

Junior Member
Joined
Nov 28, 2011
Professional Status
Certified Residential Appraiser
State
California
FHA report

UW states "see attached prelim, property is in a PUD with cc&rs please check the PUD box on page one... There is no HOA or HOA dues"

Here is the handbook.

A Planned Unit Development (PUD) refers to a residential development that contains, within the overall boundary of the subdivision, common areas and facilities owned by a Homeowners’ Association (HOA), to which all homeowners must belong and to which they must pay lien-supported assessments. A unit in a PUD consists of the fee title to the real estate represented by the land and the improvements thereon plus the benefits arising from ownership of an interest in the HOA.

An Appraiser must contact the Mortgagee if the Property is located in a PUD that does not meet this definition.



Has anyone else run into this issue? Do they tell you just check the box and state it is a PUD with no HOA/common areas/elements?
 

Randolph Kinney

Elite Member
Joined
Apr 7, 2005
Professional Status
Retired Appraiser
State
North Carolina
You have to love the form and check boxes. Check boxes were designed for loan processors and underwriters.

Yeah, had a PUD that was dissolved. CC&R runs with the deed. So title shows this and UW stops and insists that you must check the box and explain that you lied on page 1, knowingly, and admit to it in the addendum. :rof:
 

glenn walker

Elite Member
Joined
Oct 11, 2006
Professional Status
Certified Residential Appraiser
State
California
There are PUDs in California that do not have a HOA or Association dues - Many have special assessments included in the property taxes which can be mellow-roose or CFD zones. Anyway if the Preliminary Title report has whats called a PUD rider and the legal shows interest or common areas than its a PUD ** So check the box and be done.
 

Meandering

Elite Member
Joined
Feb 26, 2006
Professional Status
Real Estate Agent or Broker
State
Pennsylvania
Just because no HOA currently exists, does not mean one can’t start up tomorrow and start charging dues. This what lenders are worried about and why they want the box checked if, the requirement to belong to a HOA is within the deed, as that condition runs with the land, until someone sue’s to have it removed.

.
 

Peter LeQuire

Elite Member
Joined
Jan 3, 2005
Professional Status
Retired Appraiser
State
Tennessee
FHA report

UW states "see attached prelim, property is in a PUD with cc&rs please check the PUD box on page one... There is no HOA or HOA dues"

Here is the handbook.

A Planned Unit Development (PUD) refers to a residential development that contains, within the overall boundary of the subdivision, common areas and facilities owned by a Homeowners’ Association (HOA), to which all homeowners must belong and to which they must pay lien-supported assessments. A unit in a PUD consists of the fee title to the real estate represented by the land and the improvements thereon plus the benefits arising from ownership of an interest in the HOA.

An Appraiser must contact the Mortgagee if the Property is located in a PUD that does not meet this definition.



Has anyone else run into this issue? Do they tell you just check the box and state it is a PUD with no HOA/common areas/elements?

The handbook would benefit from a careful editing for clarity. The PUD definition conflicts with the instruction, as the instruction sets out a condition that is not consistent with the definition of PUD - i.e., if there's no fee, it's not a PUD. I would suggest that a the legal characteristics of a PUD can exist without the payment of assessments, and that the correct language would be "...to which they MAY pay lien-supported assessments."
 

Ariba

Senior Member
Joined
Feb 8, 2004
Professional Status
Certified Residential Appraiser
State
Colorado
In my market area there are many new development that are PUD's without monthly HOA dues. These developments have Metropolitan Districts which are political subdivision of the State of Colorado, designed to serve as perpetual quasi-municipal corporations, that operate with an elected five-person Board of Directors. The primary purpose of the District is to finance public infrastructure required by the development and to provide an ongoing governmental structure for the operation and maintenance of district improvements and facilities. The District also performs Architectural Review and Covenant Control functions, in the place of a traditional HOA.

I run into problems with these situations with lender all the time as they say there is no HOA and I agree. However, when you mark the PUD box and to produce an UAD compliant report you have to mark the HOA box.
 
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