M-100 THE ESSENTIALS OF COMMUNITY ASSOCIATION
MANAGEMENT UPDATED QUESTIONS AND
CORRECT ANSWERS
Question:
1. community association
Answer:
legal entity in which the owners enjoy the protection, enhancement, maintenance & preservation of their
homes & property
Question:
2. community association has 3 defining characteristics
Answer:
Membership in the community is mandatory & automatic for all owners; certain association docs bind the
owner & the association to each other through mandated actions; mandatory lien-based assessments
(maintenance fees) are levied on each owner in order to operate & maintain the community assocation
Question:
3. lien
Answer:
legal claim by one party (community association) on the property of another (delinquent owner) to obtain
the payment of a debt or the satisfaction of an obligation.
Question:
4. What does the lien do?
Answer:
Placing a lien on an owner's property protects the community association's interests. It encourages payment
of the debt. Consequence of lien is the owner cant sell or transfer the unit without settling the debt.
Question:
5. Purpose of a community assocation
Answer:
to provide for the community, business, & governance aspects of the association. This is achieved by
administering, maintaining, & enhancing a residential real estate development, and through the
establishment of a system of property rights, binding covenants & restrictions, & rules & regulations.
Question:
6. 3 basic types of residential community associations (1)
Answer:
Planned community; owner owns his unit ; community owns any common areas such as tennis courts, for
the use & benefit of the lot owners
Question:
7. second type
, Answer:
Condominium; owner owns his living unit & an undivided interest in the common elements of the
community. Each owner owns a % of the common elements, which consist of everything except the living
units.
Question:
8. third type
Answer:
Cooperative; person owns stock or membership; holds a proprietary lease or occupancy agreement for his
living unit
Question:
9. Proprietary lease or occupancy agreement
Answer:
defines the member or stockholders' rights & obligations in relation to the living unit. The community
association owns all of the real estate as a not-for-profit corporation.
Question:
10. 3 types of residential community associations can exist by themselves or can be group in clusters
called:
Answer:
Master or umbrella associations: consists of more than 1 residential community association.
Question:
11. Second type
Answer:
Mixed-use development-consists of a mixture of residential & commercial &/or industrial uses grouped
together.
Question:
12. Third type
Answer:
55 & older communities; must have 1 person who is 55 of age or older living in at least 80% of occupied
units.
Question:
13. Sources of legal obligations for a community association
Answer:
Federal, state & local statues, regulations, & case law
Question:
14. second source
Answer:
legal documents unique to the community association that bind the association & its owners
Question:
15. third source
MANAGEMENT UPDATED QUESTIONS AND
CORRECT ANSWERS
Question:
1. community association
Answer:
legal entity in which the owners enjoy the protection, enhancement, maintenance & preservation of their
homes & property
Question:
2. community association has 3 defining characteristics
Answer:
Membership in the community is mandatory & automatic for all owners; certain association docs bind the
owner & the association to each other through mandated actions; mandatory lien-based assessments
(maintenance fees) are levied on each owner in order to operate & maintain the community assocation
Question:
3. lien
Answer:
legal claim by one party (community association) on the property of another (delinquent owner) to obtain
the payment of a debt or the satisfaction of an obligation.
Question:
4. What does the lien do?
Answer:
Placing a lien on an owner's property protects the community association's interests. It encourages payment
of the debt. Consequence of lien is the owner cant sell or transfer the unit without settling the debt.
Question:
5. Purpose of a community assocation
Answer:
to provide for the community, business, & governance aspects of the association. This is achieved by
administering, maintaining, & enhancing a residential real estate development, and through the
establishment of a system of property rights, binding covenants & restrictions, & rules & regulations.
Question:
6. 3 basic types of residential community associations (1)
Answer:
Planned community; owner owns his unit ; community owns any common areas such as tennis courts, for
the use & benefit of the lot owners
Question:
7. second type
, Answer:
Condominium; owner owns his living unit & an undivided interest in the common elements of the
community. Each owner owns a % of the common elements, which consist of everything except the living
units.
Question:
8. third type
Answer:
Cooperative; person owns stock or membership; holds a proprietary lease or occupancy agreement for his
living unit
Question:
9. Proprietary lease or occupancy agreement
Answer:
defines the member or stockholders' rights & obligations in relation to the living unit. The community
association owns all of the real estate as a not-for-profit corporation.
Question:
10. 3 types of residential community associations can exist by themselves or can be group in clusters
called:
Answer:
Master or umbrella associations: consists of more than 1 residential community association.
Question:
11. Second type
Answer:
Mixed-use development-consists of a mixture of residential & commercial &/or industrial uses grouped
together.
Question:
12. Third type
Answer:
55 & older communities; must have 1 person who is 55 of age or older living in at least 80% of occupied
units.
Question:
13. Sources of legal obligations for a community association
Answer:
Federal, state & local statues, regulations, & case law
Question:
14. second source
Answer:
legal documents unique to the community association that bind the association & its owners
Question:
15. third source
