Is the extra fee for “administrative fee for non-resident co-owners” legal?

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Is the extra fee for “administrative fee for non-resident co-owners” legal?

My home (PUD in Michigan) association recently asked non-resident co-owners (anyone who does not live in the house, renting or not) to pay extra $50 per month as “administrative fee for non-resident co-owners”. Since I rent out my house, it will impact me. The extra fee doesn’t seem to be fair and I can’t find any support in the association by-law. Can this policy stand ground legally? Shall I challenge it? Thanks.

Asked on September 12, 2010 under Real Estate Law, Michigan

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The fee *could* stand legally, in the sense that there is no law against charging an administrative fee, or a greater one to non-resident co-owners. However, it may not be imposed at will. It would need to be something that's in the HOA agreement, the bylaws, some other contract or agreement by which you're bound, community rules, etc.--i.e. there needs to be some contractual basis for it. It may be the case that the governing documents allow the association to change or add fees at will,  in which case they can do this. If that's not the case, they could only add it whenever the governing agreements or rules come up for renewal. If you haven't already, ask the association to show you or point out the basis for the fee; take a look and see if makes sense.


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