CAM - COMMUNITY ASSOCIATION
MANAGER LICENSE GA ACTUAL QUESTIONS
AND 100% CORRECT ANSWERS
Question 1
What are the reasons that owners in a GCA or POAA may have the right to control the
association from the declarant?
Correct Answer
If the declarant fails to do any of the following:
1. Incorporate or maintain an annual registration
2. Cause the board to be duly appointed and the officers to be elected
3. Maintain and make available to owners, upon written request, a list of names and
business or home addressed of the association's current directors and officers
4. Call meetings of the members of the association according to the bylaws and at
least annually
5. Prepare annual budget, establish assessments, distribute budget and notice of
assessment to owners no later than 30 days after the beginning of the fiscal year
6.Pay property taxes on common property of the association for two or more years
Question 2
The GCA states that the declarant loses the right to appoint and remove directors and
officers in a One Phase condominium project on or earlier of:
Correct Answer
1. The date that 80% of the undivided interest in the common elements have been
sold (technically 80% of property sold)
2. THREE years after recording the declaration
3. Or the date that the declarant voluntarily surrenders this right
Page 1 of 92
,Question 3
True or False: Lien must be paid at sale of property or buyers and buyer's lenders will
not be able to obtain title insurance and lien will be ahead of buyer's ownership
interest and lender's security deed
Correct Answer
True. It has to be paid off by buyer or seller.
Question 4
Does an HOA need to become incorporated in order to be a corporation?
Correct Answer
Yes. They must be recorded in the land records of their county in order to become
established (the Articles of Incorporation and the Bylaws)
Question 5
To resolve a conflict of interest...
Correct Answer
-The director with the conflict of interest must disclose the conflict to other board
members
-The transaction must be approved by: a majority (but not less than two) qualified
directors, a committee empowered by the board to vote on the transaction, a
majority vote of the membership
-A director can still vote on the transaction as long as they disclosed it prior to the
vote to the board. However, they cannot be the tie-breaking vote. In the event that
the director cannot disclose the conflict (per se due to attorney-client privilege)
then the director must excuse themselves and state that they have a conflict of
interest, and can not vote
Page 2 of 92
,Question 6
What are some obstacles to collections?
Correct Answer
Lender foreclosure
- Non-judicial foreclosure (no lawsuit or court order necessary)
- Extremely fast process in GA
- First mortgage has priority so lender foreclosure extinguishes association lien
- If excess funds after foreclosure sale, association might get paid some money
(unlikely in these economic times, properties are usually worth less than the loans)
Bankruptcy
- Any and all collection action must stop immediately
- Creditors can proceed with collection efforts if the bankruptcy is discharged,
dismissed, or the bankruptcy judge allows creditor to do so
Question 7
What is the Business Judgement Rule (BJR)
Correct Answer
This is used by courts to evaluate the decisions of the board of directors. It requires
the board to follow their duties of care and loyalty including using good faith,
common sense, relying on opinions and recommendations from professionals, and
put the interests of the corporation ahead of individual interests of board members
Question 8
Limited Warranty Deed
Correct Answer
Grantor is limiting the warranties given to the grantee; Only promising that nothing
went wrong while grantor owned the property; doesn't cover any owners in chain of
title
Question 9
What if a quorum isn't met at the meeting?
Correct Answer
Then no business can be conducted
Page 3 of 92
, Question 10
Typically, who elects the first board of directors?
Correct Answer
The developer
Question 11
Cash Basis Accounting
Correct Answer
Reporting income when the cash is received and expenses when the cash is paid.
Question 12
How long does a proxy last?
Correct Answer
Unless specified, a proxy form lasts for 11 months!
Question 13
Do brokers need permission to sell RE in a community they also manage?
Correct Answer
Yes. It is normally in the management contract, however if the broker thinks far
enough ahead.
Question 14
True of False: An owner should be charged a specific assessment for damage from
driving into the front entrance sign of a POAA.
Correct Answer
True
Page 4 of 92
MANAGER LICENSE GA ACTUAL QUESTIONS
AND 100% CORRECT ANSWERS
Question 1
What are the reasons that owners in a GCA or POAA may have the right to control the
association from the declarant?
Correct Answer
If the declarant fails to do any of the following:
1. Incorporate or maintain an annual registration
2. Cause the board to be duly appointed and the officers to be elected
3. Maintain and make available to owners, upon written request, a list of names and
business or home addressed of the association's current directors and officers
4. Call meetings of the members of the association according to the bylaws and at
least annually
5. Prepare annual budget, establish assessments, distribute budget and notice of
assessment to owners no later than 30 days after the beginning of the fiscal year
6.Pay property taxes on common property of the association for two or more years
Question 2
The GCA states that the declarant loses the right to appoint and remove directors and
officers in a One Phase condominium project on or earlier of:
Correct Answer
1. The date that 80% of the undivided interest in the common elements have been
sold (technically 80% of property sold)
2. THREE years after recording the declaration
3. Or the date that the declarant voluntarily surrenders this right
Page 1 of 92
,Question 3
True or False: Lien must be paid at sale of property or buyers and buyer's lenders will
not be able to obtain title insurance and lien will be ahead of buyer's ownership
interest and lender's security deed
Correct Answer
True. It has to be paid off by buyer or seller.
Question 4
Does an HOA need to become incorporated in order to be a corporation?
Correct Answer
Yes. They must be recorded in the land records of their county in order to become
established (the Articles of Incorporation and the Bylaws)
Question 5
To resolve a conflict of interest...
Correct Answer
-The director with the conflict of interest must disclose the conflict to other board
members
-The transaction must be approved by: a majority (but not less than two) qualified
directors, a committee empowered by the board to vote on the transaction, a
majority vote of the membership
-A director can still vote on the transaction as long as they disclosed it prior to the
vote to the board. However, they cannot be the tie-breaking vote. In the event that
the director cannot disclose the conflict (per se due to attorney-client privilege)
then the director must excuse themselves and state that they have a conflict of
interest, and can not vote
Page 2 of 92
,Question 6
What are some obstacles to collections?
Correct Answer
Lender foreclosure
- Non-judicial foreclosure (no lawsuit or court order necessary)
- Extremely fast process in GA
- First mortgage has priority so lender foreclosure extinguishes association lien
- If excess funds after foreclosure sale, association might get paid some money
(unlikely in these economic times, properties are usually worth less than the loans)
Bankruptcy
- Any and all collection action must stop immediately
- Creditors can proceed with collection efforts if the bankruptcy is discharged,
dismissed, or the bankruptcy judge allows creditor to do so
Question 7
What is the Business Judgement Rule (BJR)
Correct Answer
This is used by courts to evaluate the decisions of the board of directors. It requires
the board to follow their duties of care and loyalty including using good faith,
common sense, relying on opinions and recommendations from professionals, and
put the interests of the corporation ahead of individual interests of board members
Question 8
Limited Warranty Deed
Correct Answer
Grantor is limiting the warranties given to the grantee; Only promising that nothing
went wrong while grantor owned the property; doesn't cover any owners in chain of
title
Question 9
What if a quorum isn't met at the meeting?
Correct Answer
Then no business can be conducted
Page 3 of 92
, Question 10
Typically, who elects the first board of directors?
Correct Answer
The developer
Question 11
Cash Basis Accounting
Correct Answer
Reporting income when the cash is received and expenses when the cash is paid.
Question 12
How long does a proxy last?
Correct Answer
Unless specified, a proxy form lasts for 11 months!
Question 13
Do brokers need permission to sell RE in a community they also manage?
Correct Answer
Yes. It is normally in the management contract, however if the broker thinks far
enough ahead.
Question 14
True of False: An owner should be charged a specific assessment for damage from
driving into the front entrance sign of a POAA.
Correct Answer
True
Page 4 of 92
