Question 1

What is a reserve study?

Accepted Answer

A reserve study is a financial planning document that shows whether an HOA has enough money saved for major repairs—and whether you face special assessment risk. It includes an inventory of building components, their remaining useful life, and projected replacement costs.

Question 2

What is a good percent funded for an HOA?

Accepted Answer

A good percent funded for an HOA is 70% or higher. Below 30% is a red flag signaling high special assessment risk. Between 30-70% requires careful review of upcoming expenses and deferred maintenance items.

Question 3

How do I read HOA documents?

Accepted Answer

When reading HOA documents, focus on three key areas: the reserve study (check percent funded and RUL=0 items), the CC&Rs (check restrictions and rules), and financial statements (check for pending assessments). GoverningDocs can analyze these automatically in minutes.

Question 4

What is a SIRS report in Florida?

Accepted Answer

A SIRS (Structural Integrity Reserve Study) is a Florida-mandated engineering assessment that evaluates building condition and calculates required reserve funding for structural repairs. Required for all 3+ story condos since the 2022 Surfside legislation.

Question 5

What does RUL = 0 mean?

Accepted Answer

RUL = 0 means Remaining Useful Life is zero—the building component is past due for replacement. These deferred maintenance items often trigger surprise special assessments and should be a red flag during condo due diligence.

Question 6

What are special assessments?

Accepted Answer

Special assessments are mandatory fees charged by HOAs when regular reserves are insufficient to cover major repairs. They can range from $5,000 to over $100,000 per unit and often come with short payment deadlines of 30-90 days.

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