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CAI Exam Study Guide

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CAI Exam Study Guide Community Association - ANSWER legal entity in which the owners enjoy the protection, enhancement, maintenance and preservation of their homes and property. What're the three def ... ining characteristics of community associations? - ANSWER 1. Membership in the community association is mandatory and automatic for all owners 2. Certain association governing documents bind the owner and the association to each other through mandated actions. 3. Mandatory lien-based assessments (maintenance fees) are levied on each owner in order to operate and maintain the community association. What is a 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. What is the primary purpose of a community association? - ANSWER Purpose is to provide for the community, business, and governance aspects of the association. This is done by administering, maintaining, and enhancing a residential real estate development, and through the establishment of a system of property rights, binding covenants and restrictions, and rules and regulations. What're the 3 types of basic residential community associations? - ANSWER 1. Planned Community 2. Condominium 3. Cooperative What is a planned community? - ANSWER Owner owns his or her own long and/or living unit The community owns any common areas, such as tennis courts and roads for the use and benefit of the lot owners. What is a condominium? - ANSWER The individual owns his or her living unit and an undivided interest in the common elements of the community. Each owner owns a percentage of the common elements - which consist of everything except the living units, ex. pool or lobby. The community association itself owns no real estate as an association. What is a cooperative association? - ANSWER An individual owns stock or membership in the cooperative and holds a proprietary lease or occupancy agreement for his or her living unit. What is a proprietary lease or occupancy agreement? - ANSWER defines the member or stockholder's rights and obligations in relation to the living unit. The 3 types of residential community associations can exist by themselves or they can be grouped in clusters called: - ANSWER 1. Master or umbrella associations 2. Mixed-use developments 3. [Show More]

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