M100 ESSENTIALS OF COMMUNITY ASSOCIATION
MANAGEMENT FINAL EXAM STUDY GUIDE
2025/2026 COMPLETE QUESTIONS BANK AND
CORRECT DETAILED ANSWERS WITH RATIONALES
|| 100% GUARANTEED PASS
<BRAND NEW VERSION>
1. Community association - ANSWER ✓ legal entity in which the owners
enjoy the protection, enhancement, maintenance & preservation of their
homes & property
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
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.
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.
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.
,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
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.
8. Third type - ANSWER ✓ Cooperative; person owns stock or membership;
holds a proprietary lease or occupancy agreement for his living unit
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.
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.
11.Second type - ANSWER ✓ Mixed-use development-consists of a mixture of
residential & commercial &/or industrial uses grouped together.
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.
13.Articles of Incorporation - ANSWER ✓ A document that brings the
corporation into existence, defines it basic purpose or powers, indicates
whether stock will be issued, and indicates whether there will be a board of
directors -- and if so, identifies the initial board. Incorporation may not be a
legal requirement for a community association. It is essential for
cooperatives because it in itself is a corporation. Condominium associations
are often incorporated as well, but do not have to be because they exist under
the authority of a state condominium statute. The benefits of incorporating
an incorporating a community association include: helping to limit the
liability of individual owners for acts of the community association, it
entitles the association to the rights granted to all corporations under state
, law -- which could be useful in areas such as obtaining financing, obtaining
insurance, or bringing suit against another party. It also may make it easier
to deal with other parties such as utility companies or vendors.
14.Books of Resolution - ANSWER ✓ An orderly, indexed record of the
resolutions adopted by the board of directors in a community association. In
some communities, it includes the resolutions adopted by the architectural
guidelines committee as approved by the board. Note: a resolution cannot
conflict with or override requirements in a statute or document higher in the
hierarchy of the governing documents.
15.Bylaws - ANSWER ✓ Formally adopted governing regulations for the
administration and management of a community association. Planned
communities, condominiums and cooperative all have bylaws are developed
as part of the declaration. They address topics including requirements for
membership in the community association, requirements for membership
meetings, voting rights of member owners, procedures for electing the board
of directors, and the qualifications of directors. They also address procedures
for the board to elect officers, the general powers of the board, provision for
indemnification of officers and directors (except in cases of gross negligence
or willful misconduct.
16.CC&Rs - ANSWER ✓ Covenants, Conditions, and Restrictions. Sometimes
used interchangeably with 'declaration'. The legal community refers to this
document as 'running with the land' because the CC&Rs attach and apply to
the land, no matter who the owner is in the present or future. More than any
other single document, the CC&Rs bring the condominium or planned
community comes into existence. The CC&Rs generally: define the portions
of the development owned by the individual owners and those owned by the
community association, creates interlocking relationships binding all the
owners to one another and to the community association for the purposes of
maintaining, governing, and funding the development. It also establishes
protective standards, restrictions, and obligations in areas ranging from
architectural control to prohibitions on various activities in order to promote
harmonious living; it creates the administrative framework for the operation
and management of the association -- although many of the specific
administrative details are spelled out in the bylaws; provides the mechanism
for financial support of the association through assessments; and provides
, for a transition of control of the association from the developer to the
owners.
17.Real property insurance - ANSWER ✓ Buildings land and information
18.Personal property insurance - ANSWER ✓ Inventory, furniture, fine arts,
equipment, supplies, machinery and valuable papers and records that belong
to the community association
19.Liability insurance - ANSWER ✓ Helps with situations in which a civil
legal claim is brought against the association because of a legal wrong it is
alleged to have directly committed or for which is supposedly responsible
20.Liability insurance coverages and endorsements - ANSWER ✓ General
liability, auto liability, directors and officers liability, and umbrella
21.Income insurance coverages and endorsements - ANSWER ✓ Fidelity
insurance, business income insurance, assessments receivable and Fidelity,
extra expense insurance
22.Fidelity insurance - ANSWER ✓ Protects against employee dishonesty
which may lead to the theft of money, securities, or property
23.Business income insurance - ANSWER ✓ Covers the loss of certain types of
business income
24.Assessments receivable insurance - ANSWER ✓ Applies to situations in
which a covered loss happens to the property in the community association
is unable to collect assessments from the owner
25.Extra expense insurance - ANSWER ✓ Applies when a covered loss either
increases operating expenses or diminishes the income produced by normal
operations
26.Personnel exposures - ANSWER ✓ Loss are limited to loss of service due to
injuries received while working on behalf of the community association
MANAGEMENT FINAL EXAM STUDY GUIDE
2025/2026 COMPLETE QUESTIONS BANK AND
CORRECT DETAILED ANSWERS WITH RATIONALES
|| 100% GUARANTEED PASS
<BRAND NEW VERSION>
1. Community association - ANSWER ✓ legal entity in which the owners
enjoy the protection, enhancement, maintenance & preservation of their
homes & property
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
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.
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.
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.
,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
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.
8. Third type - ANSWER ✓ Cooperative; person owns stock or membership;
holds a proprietary lease or occupancy agreement for his living unit
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.
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.
11.Second type - ANSWER ✓ Mixed-use development-consists of a mixture of
residential & commercial &/or industrial uses grouped together.
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.
13.Articles of Incorporation - ANSWER ✓ A document that brings the
corporation into existence, defines it basic purpose or powers, indicates
whether stock will be issued, and indicates whether there will be a board of
directors -- and if so, identifies the initial board. Incorporation may not be a
legal requirement for a community association. It is essential for
cooperatives because it in itself is a corporation. Condominium associations
are often incorporated as well, but do not have to be because they exist under
the authority of a state condominium statute. The benefits of incorporating
an incorporating a community association include: helping to limit the
liability of individual owners for acts of the community association, it
entitles the association to the rights granted to all corporations under state
, law -- which could be useful in areas such as obtaining financing, obtaining
insurance, or bringing suit against another party. It also may make it easier
to deal with other parties such as utility companies or vendors.
14.Books of Resolution - ANSWER ✓ An orderly, indexed record of the
resolutions adopted by the board of directors in a community association. In
some communities, it includes the resolutions adopted by the architectural
guidelines committee as approved by the board. Note: a resolution cannot
conflict with or override requirements in a statute or document higher in the
hierarchy of the governing documents.
15.Bylaws - ANSWER ✓ Formally adopted governing regulations for the
administration and management of a community association. Planned
communities, condominiums and cooperative all have bylaws are developed
as part of the declaration. They address topics including requirements for
membership in the community association, requirements for membership
meetings, voting rights of member owners, procedures for electing the board
of directors, and the qualifications of directors. They also address procedures
for the board to elect officers, the general powers of the board, provision for
indemnification of officers and directors (except in cases of gross negligence
or willful misconduct.
16.CC&Rs - ANSWER ✓ Covenants, Conditions, and Restrictions. Sometimes
used interchangeably with 'declaration'. The legal community refers to this
document as 'running with the land' because the CC&Rs attach and apply to
the land, no matter who the owner is in the present or future. More than any
other single document, the CC&Rs bring the condominium or planned
community comes into existence. The CC&Rs generally: define the portions
of the development owned by the individual owners and those owned by the
community association, creates interlocking relationships binding all the
owners to one another and to the community association for the purposes of
maintaining, governing, and funding the development. It also establishes
protective standards, restrictions, and obligations in areas ranging from
architectural control to prohibitions on various activities in order to promote
harmonious living; it creates the administrative framework for the operation
and management of the association -- although many of the specific
administrative details are spelled out in the bylaws; provides the mechanism
for financial support of the association through assessments; and provides
, for a transition of control of the association from the developer to the
owners.
17.Real property insurance - ANSWER ✓ Buildings land and information
18.Personal property insurance - ANSWER ✓ Inventory, furniture, fine arts,
equipment, supplies, machinery and valuable papers and records that belong
to the community association
19.Liability insurance - ANSWER ✓ Helps with situations in which a civil
legal claim is brought against the association because of a legal wrong it is
alleged to have directly committed or for which is supposedly responsible
20.Liability insurance coverages and endorsements - ANSWER ✓ General
liability, auto liability, directors and officers liability, and umbrella
21.Income insurance coverages and endorsements - ANSWER ✓ Fidelity
insurance, business income insurance, assessments receivable and Fidelity,
extra expense insurance
22.Fidelity insurance - ANSWER ✓ Protects against employee dishonesty
which may lead to the theft of money, securities, or property
23.Business income insurance - ANSWER ✓ Covers the loss of certain types of
business income
24.Assessments receivable insurance - ANSWER ✓ Applies to situations in
which a covered loss happens to the property in the community association
is unable to collect assessments from the owner
25.Extra expense insurance - ANSWER ✓ Applies when a covered loss either
increases operating expenses or diminishes the income produced by normal
operations
26.Personnel exposures - ANSWER ✓ Loss are limited to loss of service due to
injuries received while working on behalf of the community association
