One of the most unpleasant aspects of management of a Homeowners Association is collection of Assessments. Your budget requires full funding in order to meet the expenses of the Association, which include insurance, grounds and building maintenance, utilities, taxes, reserves etc. The only significant source of funds is member Assessments. If payment is not made, collections progresses in accordance with the Association’s Governing Documents through a series of letters and fees, Recording of a formal Lien with the County, progress through County court to secure a personal judgment for the balance owing, possible seizure and sale of property through the County Sheriff…
Should these considerable efforts not succeed, the Association may only be left with costly legal action toward foreclosure of the home.
While these steps may sound drastic and unpleasant, and they are, collection of 100% of Assessments is necessary to balance the budget. There are no “bailouts” and the Association has limited options. Failure to collect the amounts necessary to balance the budget require one of these options: Special Assessments to the well-paying owners to cover those who don’t pay, further cutting of services or insurance (higher risk to owners), borrowing from necessary reserves (delays the inevitable) or increasing Assessments to everyone… None of these are good options, particularly since the budget is already very VERY lean…
Just like every household is doing its share of belt-tightening, every Homeowners Association in this economy is facing this challenge. Your Board and management are working diligently to keep YOUR fees low and we are focused on fairness. It is fair that everyone pay their share so that you don’t have to make up for those who choose not to pay. Nationally, the average delinquency is over 13% but due to focused efforts, your Association is in far better shape. This figure is improving as we progress. Here are the current collections statistics:
___ Homes greater than 3 months behind in Assessments
___ Homes with liens recorded with the County
___ Homeowners in the County Court Judgment process (some served by Sheriff, some by Private Process)
___ Homeowners with the Association’s attorney
