When it comes to buying a home, there are various rules and regulations that you need to be aware of to avoid future complications. One possible set of rules that you might face are restrictive covenants. If you are moving into a community that has a homeowners association, here is what you need to know about restrictive covenants and their potential impact on your homeownership.
What Are Restrictive Covenants?
Homeowners associations are charged with overseeing the common areas of a community. Some associations have relatively lax rules, while others rely on stricter rules to protect the community and its value. One of the ways that a homeowners association can protect the community is through the use of restrictive covenants.
A restrictive covenant is basically an agreement between the homeowners in the community and the association. The agreement dictates what you can and cannot do with your property.
For instance, the agreement could include restrictions on how many people live on your property, the landscaping, and the window treatments you use.
What Happens If You Break the Agreement?
Each homeowner's association has the right to set the consequences for what happens when the agreement is broken by a homeowner. The consequences could be as simple as paying a small fine. Depending on the severity of the situation, the homeowners association could have a clause that gives it the right to challenge your homeownership in court if you violate certain rules.
Carefully review the agreement before closing to guarantee that you fully understand the terms. If you do not agree with it, there are steps you can possibly take to continue with the purchase of the home and get some relief from the covenant agreement.
Is It Negotiable?
After reviewing the restrictive covenants, you have to decide whether or not there are any rules that you cannot abide. If so, you might be able to negotiate with the homeowners association for relief on those rules.
For instance, if the homeowners association has a rule in place about the limit of cars that can be stored on the property and you own more cars than the limit, you might be able to convince the association to raise the limit.
You also have the choice of walking away from the purchase of the home. Your purchase contract should include a contingency that allows you to do so if you are unable to live with the association's agreement.
To ensure that you have covered your bases with the restrictive covenants, review the agreement with a real estate agent. For more information, contact a business such as Fischer Homes.Share