Homeowners associations (HOAs) in New Jersey do not have a dedicated statute that governs their operation and corporate structure. However, these organizations are still regulated by state law. In this article, we'll walk you through these statutes to help you understand how HOAs in New Jersey are to be run.

Understanding the Basics

Before diving in head first, let's first ensure that we have a good foundation, so let's start with a simple definition of the term "homeowners association."

Put simply, a homeowners, community, or property owners association is a non-government organization that is formed to maintain shared areas and amenities. This might include a swimming pool, roadway, or park.

The purpose of instituting such an organization is to ensure that certain standards and quality of life are maintained. HOAs also help to maintain property values.

These common interest communities are regulated by state laws and are subject to their own governing documents, which will include the following:

  • Articles of Incorporation
  • Declaration of Covenants, Conditions, and Restrictions
  • Bylaws

The New Jersey HOA Laws That Govern Common Interest Communities

Here are some of the state laws that you will need to familiarize yourself with:

Planned Real Estate Development Full Disclosure Act (PREDFDA)

The Planned Real Estate Development Full Disclosure Act, which went into effect on the 22nd of November 1978, regulates certain elements of homeowners associations.

It was revised in 2017 to clarify that all unit owners in the community are considered to be members of the HOA, to offer basic rights for participation in elections to certain members, and to regulate how the association's bylaws are to be amended.

The New Jersey Nonprofit Corporation Act

This act oversees non-profit corporations in terms of their organizational makeup and operations. The majority of condo and homeowners' organizations in New Jersey are considered non-profit organizations.

To determine an association's corporate status, you can go to the Division of Revenue and Enterprise Services.

The New Jersey Law Against Discrimination

Housing discrimination is illegal in the state of New Jersey, and the state offers victims state-level protections. This law prohibits discrimination on the basis of the following: 

  • Ancestry
  • Marital status
  • Disability
  • Color
  • Race
  • Sexual orientation
  • Gender identity
  • Source of lawful income
  • Liability for service in the Armed Forces
  • National origin
  • Familial status
  • Creed
  • Age
  • Sex

It is comparable to the federal Fair Housing Act (FHA) and the Americans with Disabilities Act (ADA), but instead of federal protections, it offers protection at the state level.

New Jersey Condominium Act

This legislation is applicable to condominium associations (COAs) that were formed after the seventh of January 1970.

It establishes an extensive regulatory structure in New Jersey for, among other things, COA creation, allocation of interest, voting rights, expenditures, association governance and functions, and purchaser protection.

If a COA exists as a non-profit, it also has to comply with the Planned Real Estate Development Full Disclosure Act and New Jersey's Nonprofit Corporation Act.

The Cooperative Recording Act of New Jersey

This law acknowledges and structures cooperative ownership. This includes, but is not limited to, the organization, administration, voting, and ownership rights of such entities.

Cooperatives are also required to follow the Planned Real Estate Development Full Disclosure Act, in addition to New Jersey’s Corporations statute. 

Fines for Violations and Late Payments

New Jersey HOA board members have the authority to fine a property owner for breaking its rules and regulations. Although there are no regulations governing these charges, they may range from $20 to more than $500, subject to the extent and duration of the offense.

Details regarding the amount and type of such fees, as well as the requirements for notification, are typically included in the governing documents. 

About DoorLoop's Innovative HOA Management Tools

Running a homeowners association is no walk in the park. There are so many laws in place at federal, state, and local levels, so ensuring compliance can seem overwhelming. The good news is that our HOA management software is designed to do just that.

Like property management software that allows you to collect and track rental or mortgage payments, this software lets you receive assessments. Moreover, it is jam-packed with powerful features, such as accounting tools, that can help you manage the books and prepare important financial records.

You can also use our software to communicate with association members and vendors, streamlining your day-to-day operations and ensuring transparency.

Now, you can try it out for yourself by scheduling a free demo! Contact us for more information.

Closing Thoughts

Understanding the legal framework set out by state law is no easy task. This is why we recommend taking your research a step further and consulting a legal expert for counsel to truly ensure that your HOA complies with the relevant legislation.

If you are looking for software that will help to make remaining compliant easier, then look no further than DoorLoop! Get in touch with us today to learn more.

Frequently Asked Questions

1. Does New Jersey have a dedicated statute that regulates debt collection practices?

No. The state of New Jersey does not have its own fair debt collection law. However, homeowners associations will be subject to the federal Fair Debt Collection Practices Act.

2. Can New Jersey homeowners associations foreclose on a home for unpaid assessments?

In New Jersey, a community association has the authority to foreclose on a member's home for unpaid liens using the same legal procedure that a financial institution would employ to foreclose on the property.

It will have to send a written notice to the association member first and allow him or her a period of 30 days to settle the outstanding amount.

3. Where can I find HOA documents in New Jersey?

Homeowners associations in New Jersey are required to file their governing documents with the county land records, so if you'd like to get a copy of them, you can head to the local county clerk’s office.

Some information can be obtained by conducting a search on the New Jersey Department of the Treasury's website.

4. What are HOAs not allowed to fine homeowners for?

Community associations in New Jersey are not permitted to restrict or ban the installation or use of the following:

  • The installation of antennas and satellite dishes
  • Solar panels and solar energy systems
  • Displaying the US national flag (as long as this is done according to the applicable laws)

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David is the co-founder & CMO of DoorLoop, a best-selling author, legal CLE speaker, and real estate investor. When he's not hanging with his three children, he's writing articles here!