Seattle Condo Glossary

Key Terms Every Condo Buyer Should Know

Buying a condo comes with its own vocabulary. If you are new to the process, some of these terms will show up in listing descriptions, HOA documents, and lender requirements. This glossary covers the essentials.

HOA (Homeowners Association)

The organization made up of all unit owners in a condominium. The HOA is responsible for managing common areas, enforcing rules, and overseeing the building's finances. Every condo owner is automatically a member.

HOA Dues (Assessments)

Monthly fees paid by each unit owner to fund the building's operating expenses and reserves. Dues cover items like insurance, utilities for common areas, maintenance, and management. Learn more in our HOA fees guide.

Reserve Fund

A savings account maintained by the HOA for major future repairs and replacements, such as a new roof, elevator modernization, or siding replacement. A healthy reserve fund reduces the likelihood of special assessments. See our reserve fund guide.

Reserve Study

A professional analysis of a building's major components, their remaining useful life, and the estimated cost to repair or replace them. The study recommends how much the HOA should be saving annually to cover those future expenses.

Special Assessment

A one-time charge levied on unit owners to cover an expense that the reserve fund cannot fully pay for. Special assessments can range from a few hundred dollars to tens of thousands per unit. Details in our special assessments guide.

Resale Certificate

A disclosure document required under Washington State law (RCW 64.34) when a condo unit is sold. It includes the HOA's financial statements, budget, reserve study, insurance details, rules, pending litigation, and more. Buyers have a right to review and rescind based on its contents. See our resale certificate guide.

CCRs (Covenants, Conditions & Restrictions)

The governing documents that establish the rules for the condominium community. CCRs cover everything from pet policies and rental restrictions to noise rules and exterior modifications.

Bylaws

The internal operating rules of the HOA. Bylaws define how the board is elected, how meetings are conducted, voting procedures, and the responsibilities of officers.

Declaration

The master legal document that creates the condominium and defines each unit's boundaries, common areas, and ownership percentages. Sometimes called the "condo declaration" or "declaration of condominium."

Common Areas

Shared spaces owned collectively by all unit owners. This includes lobbies, hallways, elevators, parking garages, rooftop decks, fitness rooms, and the building's structural elements (roof, exterior walls, foundation).

Limited Common Areas

Common areas assigned for the exclusive use of one or more specific units. Examples include balconies, storage lockers, and assigned parking spaces. The HOA typically maintains these, but the assigned owner has exclusive use.

Master Insurance Policy

The insurance policy purchased by the HOA that covers the building's structure and common areas. Individual unit owners still need their own HO-6 policy to cover personal property, interior finishes, and liability.

HO-6 Policy

A homeowners insurance policy designed for condo owners. It covers your personal belongings, interior improvements, personal liability, and any gaps between the master policy and your unit's finishes.

Warrantable Condo

A condominium that meets Fannie Mae or Freddie Mac guidelines for conventional financing. Requirements include owner-occupancy ratios, single-entity ownership limits, adequate insurance, and a financially stable HOA. See our financing guide.

Non-Warrantable Condo

A condominium that does not meet conventional lending guidelines. Buyers may need portfolio loans or alternative financing, which often come with higher interest rates or larger down payment requirements.

Owner-Occupancy Ratio

The percentage of units in a building occupied by their owners (as opposed to renters). Lenders typically require at least 50% owner-occupancy for conventional loans, and FHA requires 50% as well.

Rental Cap

A limit set by the HOA on how many units in the building can be rented out at any given time. Rental caps help maintain owner-occupancy ratios required by lenders and can affect property values.

Right of First Refusal

A provision in some HOA governing documents that gives the association (or other owners) the option to match a purchase offer before a sale to an outside buyer is completed.

Quorum

The minimum number of unit owners who must participate (in person or by proxy) for an HOA meeting or vote to be valid. Typically defined in the bylaws as a percentage of total ownership.

Proxy

A written authorization allowing one person to vote on behalf of another at an HOA meeting. Useful when owners cannot attend in person.

Turnover (Developer Turnover)

The transition of HOA control from the original developer to the unit owners. This typically happens when a certain percentage of units have been sold. Buyers in new construction should pay attention to the turnover timeline.

Estoppel Certificate

A document from the HOA confirming a unit owner's account status, including any outstanding balances, pending assessments, or violations. Often required during the closing process.

Plat Map

A detailed map or survey that shows the boundaries of each unit, common areas, and limited common areas within the condominium. Part of the declaration filed with the county.

FHA Approval

A designation indicating that a condo building meets the requirements of the Federal Housing Administration for FHA-insured loans. FHA approval expands the pool of potential buyers who can purchase in the building.

Condo Questionnaire

A standardized form completed by the HOA or management company that lenders require during the mortgage process. It provides details about the building's finances, insurance, litigation status, and owner-occupancy ratios.

Delinquency Rate

The percentage of unit owners who are behind on their HOA dues. High delinquency rates can signal financial instability in the association and may affect a building's ability to qualify for conventional financing.

Have a Question About a Term?

Condo documents are dense, and not every term is intuitive. If you run into language you do not understand while reviewing a building's HOA documents or resale certificate, reach out. I walk buyers through these materials regularly and can help you understand what you are looking at before you commit to a purchase.