Covenants, Conditions, and Restrictions of Record

CC&Rs is a real estate acronym which stands for Covenants, Conditions, and Restrictions . Often regarded as classic legal boilerplate, CC&Rs variously regulate the usages and aesthetics of a neighborhood or development to a greater or lesser degree.

CC&Rs are essentially adhesion contracts. That is, they work for the benefit of the developer who originates them and often work against the individual rights of the homeowner who buys into a planned community which might be a condominium or what is called a Homeowners' Association or a combination of many of these. To change the terms of this contract agreement typically requires a supermajority vote of two-thirds or more. Before buying a home controlled by CC&Rs, a buyer must sign a statement of acceptance of these rules. As the CC&Rs often run to 50 or more pages of legal jargon, a homeowner rarely has a full understanding of what he is agreeing to when he signs off on an acceptance.

While the Board of Directors who control the community may violate these CC&Rs with impunity, the individual homeowner who violates any of the rules may be fined. Failure to pay could lead to forced sale of his home. Since 1996, homeowners in planned communities in Arizona have lost basic homestead exemption rights even though other independent owners in Arizona have a $150,000. homestead exemption. The majority of owners subject to CC&Rs do not realize that they may have lost even this basic right along with the right to paint their house the color they might want to paint it.

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