I'm not worried about the 80% that follow the law and the agreement. ;-) 

Follow the law only exactly in California.

@Maryann Fialdini, I hate to say it but you need a good real estate lawyer IN YOUR STATE because HOA laws vary somewhat from place to place.

Written by attorney investors, it's full of practical advice about the management of investment property, has sample forms that can be edited, and - most importantly - tells you what your primary state laws are and where you can read them.

I would guess that a 3% max annual raise is more realistic because the socialists are tightening their grip on California and pushing for harsh laws to take control of properties etc. 

I got my start renovating my own rentals and helping my Electrician Father in Law on odd jobs. 

While at dinner the women were talking and the guys were looking at some pictures of crime scenes . one of the guys is in law enforcement in Baltimore . 

@Atul Mohlajee, I don't know Michigan's laws specifically, but none of this sounds out of line.

Similar to setting up a Solo 401k many are unaware of the laws and regs and don't want to touch anything unfamiliar and so it is always easier to say "we don't, can't do that.

As a lender you must prepare estiamtes for loan expenses, profits would be unknown, so they can't be disclosed under RESPA and your APR calculations will be off by much more than one tenth of one percent, so there can be another violation as a lender and usury law may apply as well.