Incorporating is not difficult and should not require a great deal of effort or money. The organization draws up Articles of Incorporation and Bylaws and files them with the appropriate State agency. The group may decide to consult a lawyer who is experienced in cooperative law. The Articles of Incorporation set the purpose of the co-op's and the reasons for it's existence. They should be tailored to reflect the co-op's nonprofit, membership-controlled nature and its right to buy and sell real estate. The Bylaws establish the co-op's operating procedures and outline the responsibilities of its members and its board of directors. 

Incorporation is a legal necessity and should take place before any contracts are signed. Individual residents who sign contracts on behalf of other residents can be held liable for any legal or financial irregularities. In a corporation, however, the corporation-not it's shareholders-bears the responsibility of the co-op's legal and financial integrity unless an officer or board member has been guilty of fraud or other serious irregularity.

Incorporation also sets up a permanent structure for decision-making conflict resolution and distribution of work. When the corporation is formed, members elect a board of directors which consists of at least a president, vice president, secretary and treasurer. The members of the temporary board of directors are usually drawn from the residents who helped initiate the conversion and they serve until the conversion is completed and a new board of directors for the co-op is elected.

1.         What is a resident owned community (ROC)?

 A resident-owned community is a manufactured home park owned by the residents of the park and operated by the Board of Directors of the corporation, usually with the assistance of a licensed management company.

 2.         How many resident-owned communities are there in Florida?

 There are more than 700 resident-owned communities in this state, with the numbers growing each year

 3.         What is the cooperative and why would we become one to buy the community?

A cooperative is a form of ownership of real property where legal title is vested in a corporation and the beneficial use of that property is evidenced by an ownership interest in the corporation such as a share.  Your right to possession of your individual lot is granted to you in the form of a 99-year Occupancy Agreement.

 4.         Why should I buy a share? 

• Security of owning real property

•  No longer subject to unreasonable rent increases by owner

• Have a voice in management and operation of your community

• Shareholders make decisions (improvements, etc.)

• Community will remain 55+

• As real estate, your share has the potential to increase in value and create equity for you and your heirs

• Your park will remain a MANUFACTURED HOME COMMUNITY

 5.         I don’t have the cash to pay for a share, what next? 

Banks typically finance 80%, but 100% is possible with your home used as security.  Share loans are now available for 10, 15 & 20 year terms.

 6.         If I finance my share, can I pay it off early?

 You can pay down or pay off your loan at any time according to the terms of your loan. Be sure that you bank allows prepayment without penalty.

 7.         What are my financial obligations as a shareholder?

•  The purchase price of the share

•  Payment of monthly maintenance fee

•  Payment of real estate taxes on your share

 8.         How do we know if the price we are paying for the park is fair?

 The purchase price will be reviewed with the bankers who we anticipate will provide a mortgage for the park. The lender may then require an independent appraisal report from a professional appraiser to support our determinations.

9.         What further costs might we have if we buy the park?

 Typically, once an appraisal and inspections are completed, reserve account requirements will be established (roof, pool, capital improvements, etc.) and included in the initial transaction.  The goal is to have little or no assessments in the future for the residents.

10.         At my age, why should I buy a share?

 Many elderly homeowners buy a share to protect the value of their home, thus leaving their spouse or children real property, not a possibly depreciating home with rent payments. Age is not a factor in obtaining a share loan.

 11.       What if my heir is younger than 55?

Your share and occupancy are an interest in real property, so it can be willed and inherited similar to any parcel of real estate, but the 80/20 rule still applies.

 12.       What will I own? 

Under the cooperative form of ownership, you will own a pro-rata share of your community, including home lots, common areas (i.e. pools, clubhouse, streets and utilities) and any of the cooperative personal property.

 13.       What will I receive to prove my ownership?

Each member will receive an individual share to reflect the ownership interest in the cooperative property. You will also receive a 99-year Occupancy Agreement that gives you the right to possess and use your individual lot, much like if you had received a deed to the lot. It automatically renews after 99 years, so the ownership interest in the co-op lasts forever.

 14.       If I am a member and want to sell my home, does the buyer of my home have to buy a share? 

Yes.  Upon receiving your share and occupancy agreement, the home and lot are considered a single piece of real estate, similar to a site-built home.  It is up to the corporation to decide if it is feasible to buy the share back and rent the lot.

 15.       What if I remain a renter and want to sell my home? Does the buyer have to buy my share?

Again, up to the corporation.  If it is decided that renters will be accepted in the future, new homeowners may be given the option to buy in or rent the lot.  If a future goal is to have the whole park become resident-owners, they may require homebuyers to buy a share.

 16.       Can I buy more than one share? 

There will be one share per lot. 

 17.       If I don’t buy a share now, can I after closing?

 You may buy a share at any time, but remember, upon closing, share prices will increase and will increase annually thereafter.

 18.       What tax benefits are available to shareholders? 

You may be entitled to Homestead Exemption on your real estate tax assessment if you are a resident of Florida.  Some may be able to use real estate taxes and ‘home and share’ mortgage interest as deductions on their personal income tax returns.  You will no longer be required to purchase new registration stickers each year.  New home buyers will no longer pay sales tax on the purchase of a new home.

 19.       How do I qualify for Homestead Exemption? 

If you are a resident of the state, you are entitled to a Homestead Exemption of up to $50,000, which is subtracted from the assessed value of your home & share.  You must file your initial Homestead Exemption with the county property appraiser by March 1^st.  Additional exemptions are available for widows, military veterans and the disabled.

 20.       If I don’t buy a share, what happens to my prospectus? 

You will continue to pay rent according to the conditions of your prospectus.  As new owners, the cooperative must assume all existing prospectuses of those who chose to remain renters.  Future rental amounts will be increased pursuant to the prospectus and Florida Law.

 21.       What gives the residents the right to buy the park and the Board of Directors the right to act on my behalf if I don’t want to buy a share?

 The articles of incorporation and bylaws of your Homeowners Association are required by Florida Statute Chapter 723 to provide that the Association has the power to negotiate for, acquire and operate the community on the behalf of the homeowners.

22.       How can we afford to buy our park? 

Your combined rents currently pay the costs to operate the park and meet the owner’s mortgage payments.  Any remaining funds now go into the landlord’s pocket as profit.  As a cooperative, the “profit” can instead be used for park improvements.