In the process of purchasing a condo, there are often cases where the loan process is more complicated than expected, and the cause is frequently related to the financial status of the HOA rather than the individual's credit. Recent market observations indicate that such cases are often seen in Billings.

The HOA fees for condos in Billings vary based on the size of the association. Small associations with fewer than 25 units often operate with fixed monthly management fees ranging from $175 to $400, while medium-sized associations with 26 to 100 units charge between $13 and $24 per unit per month, and large associations with over 100 units charge between $9 and $19 per unit per month (source: local HOA management data, as of 2026). These management fees typically cover exterior maintenance, master insurance, landscaping, snow removal, trash collection, water costs, and reserve funds. There can be significant variations in management fees even within the same city due to different maintenance plans for condos converted from older buildings downtown and newly constructed condos in the West End.

Montana does not legally mandate reserve fund accumulation or reserve studies for condo associations. While condo associations are subject to the Montana Unit Ownership Act (Montana Unit Ownership Act, Title 70 Chapter 23 MCA) and are responsible for maintaining common elements, there are no specific formulas outlined for accumulation rates or study cycles (source: Montana state law guide). However, the board has a fiduciary duty, and in a Montana case (Edgewater Townhouse HOA v Holtman), a special assessment that did not follow the association's own procedural rules was deemed invalid.

Due to the lack of legal minimum standards, there is significant variability in how associations operate their reserves, which can lead to practical risks. If major repairs such as roofing, plumbing, or elevators are needed while reserves are low, special assessments may be levied all at once.

Recent market trends show that condo listings in Billings are distinctly divided between those converted from older buildings downtown and new developments in the West End. While downtown listings tend to have lower sale prices, the age of the buildings may mean that roof or plumbing replacements are imminent, making it crucial to closely examine the reserve fund status. New developments in the West End may have somewhat higher management fees but generally face fewer major repair issues for the time being. Families considering school districts should refer to the GreatSchools ratings of assigned schools, but since district boundaries change frequently, it is advisable to verify the assigned school for the specific address before purchasing.

This point directly connects to loan approval. Mortgage lenders assess not only an individual's credit but also the HOA's delinquency rates, reserve fund ratios, any ongoing litigation, and the proportion of commercial space when evaluating condos (source: Fannie Mae condo project standards). If these criteria are not met, the condo may be classified as a non-warrantable condo, resulting in loan denial or unfavorable interest rate terms. Therefore, it is essential to check not only the price of the listing but also the association's recent financial statements and whether a reserve study has been conducted before entering into a contract.

For families relocating to Billings from other states, it is important not to apply the management fees or property tax standards from their previous residence directly, but rather to consider the unique low regulatory environment in Montana and verify the financial status of each association. This article does not constitute investment or legal advice, and it is advisable to consult with professionals before finalizing any contracts. When comparing listings, it is important not to focus solely on the amount of management fees but to also consider the size of the association, financial statements, and whether a reserve study has been conducted, as this approach can be helpful in practice. Listings that appear to have low management fees should be further scrutinized for their background.