In Virginia, when purchasing property that is governed by a Property Owners Association OR a Condominium Association, a special rescission period is granted to review the rules. Here’s how it works:
The listing agent or the seller requests what’s called a “resale package” from the management of the association either right when they put a 
property on the market for sale OR when they receive a contract. Commonly this package includes the covenants, rules & restrictions of living in that community or building, the balance sheet and other financial health related topics, information on any upcoming large expenditures and how they plan to pay for it; information on the existence of and provider for the master insurance policy (typically in a condo) and other such rules. It will also have a 2–4 page summary in the front that will tell the buyer some very important information:
- What are the current dues and how often and how they are collected
- If the owner is paid in full on their dues or if there are any back dues owed
- Whether or not there are any assessments
- Whether the association is involved in any lawsuits
- Whether there are any specific citations against the subject property
These are very important pieces of information for a buyer to understand. First – there are issues that could potentially cause a delay of settlement – any citations that are not remedied are considered clouds on the title, and the contract clearly states that the seller will convey the property to the buyer with clear and marketable title. Also, any back dues can be collected out of settlement, assuming there are proceeds being disbursed to the seller.
It’s also important however, for a buyer to understand the rules by which they will be expected to live. It’s for THIS reason, that a rescission period is given. For any resale property (whether it’s single family, townhome or even a condo) there is an automatic 3 day rescission period that begins from the day the purchaser receives this resale packet. With any new 
construction, the period is 10 days. This gives the buyer ample time to review the rules, and any other pertinent information contained in the packet and decide whether or not to proceed with the contract. In most cases, the sale goes through without a hitch.
Certainly there are cases where this rescission opportunity is mis-used, but I think for the most part it is respected as a part of the purchase process.
If you are thinking of purchasing property that is governed by a homeowners association of any sort, be sure that you’re willing to live by a set of community rules. Have a good agent representing you (I’m available!
) and carefully jump in the game.
Happy Thursday!
Jennifer Klaussen
Thank you for the information on re-sale packages. How does the bank adhere to these laws when they sale a forclosed home in a Property Owners Association. Do they have to make sure the buyer knows they are buying in a POA are does the buyer find out sometime after the purchase. It’s happening to our family now, bad situtation made worse by being lead to believe one thing( no POA) when in fact the house is in one.
Any informatin would be helpful.
Wanda
Are these rules easily available and are they set in stone or just guidelines, this can make a big difference to who will make an offer for the property.