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- Our HOA botched assessment for replacement project. Do over?
I am the president of my HOA in California. We recently passed a special assessment to replace the siding on all our buildings. The assessment was passed by majority vote (as required by our by-laws). The assessment amount was based on a ballpark estimate from one of our contractors. Once the assessment was passed, we quickly learned that the assessment amount was too low to cover the costs for a complete siding replacement. All the bids came in much higher. Rather than scrapping the assessment and doing another vote for a higher assessment amount (which we don't think will pass due to the tough economic conditions), the HOA Board would like to use the approved assessment amount to replace the siding on the back of the buildings only (which is in worse condition than the front). We would like to know if this is legally permissible. The original intent of the assessment was to replace all the siding, not just partial. - Is window and trim replacement the resposponsibility of the HOA?
Our HOA bylaws say that windows are the responsibility of the home owner. I questioned this before I purchased my condo and was told if the windows had to be changed, I would be responsible for payment of the brand new window and that was all. I was told the installation and trim would be the responsibility of the HOA. Are skylights part of the roof or do they also go under windows as mentioned in the bylaws? I wish they made a comment about skylights in the bylaws but it is not there. The bylaws says the roof is not the responsibility of the condo owner. My neighbor needs the trim that goes around the window on the siding replaced and was told that goes with the windows and I truly think that is wrong but our property management company would have us do everything and just collect our monthly fee if they could. Can anyone answer these questions for me. Greatly appreciated - How can we remove uninformed and potentially corrupt HOA board?
I would like to see the whole HOA board removed as I believe there has been some corruption going on with replacing items that do not need to be replaced and not doing what needs to be done and not allowing the condo owners to have a say in the color of a new roof, replacing skylights that they have to pay for that was put in by an inexperience roofer who damaged all 7 of mine while installing. At the present time we have 3 appointed people on the board and they are all on the side of the HOA without knowing anything about this place and what the HOA has done. How long can someone stay in office when appointed by the HOA because someone resigned? When do we get a chance to vote for someone new for the position vacated that someone was appointed to by the HOA? Do we have to wait until the term is up for the original board member that resigned before we can vote someone we want to fill that position or do we have to wait and accept the appointed person for the rest of someone's term which may be almost 3 years? Any help would be appreciated. We only have 90 units and I want to get the board off now before they do something else and charge everyone another $1,000 assessment but everyone here thinks it is not easy to do that but now we will have 3 appointed members. - Is HOA responsible for financially compensating woman in wheelchair?
I live in a condo with my Mom who is in a wheelchair. The elevator is down for repairs for one month. What are the responsibilities of the HOA to accommodate my mother. I cannot get insurance to pay this time. They did on a claim last year but are now saying they will not. What can I do to make the HOA pay for us to stay in a hotel or to get in and out of the condo? We are on the second floor. Thank you. - HOA board terrorized by "hard to handle" delinquent owner
I am the president of my condo association, and am dealing with a difficult situation. Our condo association has a high delinquency rate. We are a 150-unit property with over 40 homeowners behind in assessments. In total, in arrears is about $100,000. Earlier this year, the board voted to reassign the delinquent owners' spaces to visitors spaces, per our a provision in our bylaws. Residents can still park in front of their homes, but being that their spaces are now marked "Visitor", their spaces are fair game. This action lit a fire under some homeowners to start working out payment arrangements. Per our bylaws, once a delinquent homeowner has paid at least 50% of the amount owned, his/her parking assignment(s) will be restored. Most homeowners, while upset about this, respect the rules and regulations and are working on paying down their delinquencies. However, we have one owner -- an incredibly rude and defiant woman -- who owes over $8,000 (the most of any owner) and she refuses to abide by the rules. We've had her space spray painted at least three times because she goes and spray paints it back. When we talk to her about it, she lashes out with all kinds of irrational talk and profanity. She said she's not working and is on disability and she knows we can't do anything to her, so she feels she is justified in taking her space back. Yet those who owe less than her are forced to deal with the situation. This woman comes to board meetings terrorizing us with all kinds of demands for work she says needs to be done in and around her unit. Yet we haven't see a payment from her since 2005. We got a judgment against her last year. And when we attempted to file a lien against her, she scrambled to make an effort to pay. We were fooled. The condo attorney is slow-moving on this issue and just refiled the lien 2 months ago. There was a "show cause" hearing last week, and the woman claimed she is on disability and babysits occasionally. Meanwhile, she drives a 2008 Lexus. She's living off of something, but what we don't know. We feel like our hands are tied and this woman is holding us hostage. She said she knows we can't do anything to her because we can't garnish her disability payment. We are looking at possibly pursuing a bank garnishment or putting a lien on her car. She volunteered that someone else already has a lien on her car; apparently she was thinking ahead. My questions are: (1) what can we do to enforce the parking? The county police said since we are private property they can't enforce. Is there some sort of foolproof paint we can use on her space? and (2) what remedies could we pursue to collect payment? I cannot fathom the association having to foot the bill for work needing to be done to her unit all the while she's sitting around carefree with no intentions of even trying to pay a dollar towards the thousands that she owes us? We are hesitant to foreclose as we might not be able to resell her unit in this economy. Please help. Thanks. - Looking for condo association sample meeting minutes, please post
Question about minutes: I would like give everyone not only on this blog but on other blogs a sample of my condo association board's minutes. The board does publish minutes but no mention in those minutes of costs or plans or contracts accepted or any business information. The minutes contain more what I would call social topics like we will be having picnic and other newsletter type subjects. What would be helpful to me is to publish these minutes and get comments. Can minutes be published with names omitted? I would like to see examples of other community association minutes. Because my board and the associations professional manager are playing fast a loose with our minutes, by publishing minutes with no information about the business of the association. There is no effort on the part of my board to learn how to run a meetings and the professional manager is just dreadful and that is giving him a compliment. If you have sample condo association board meeting minutes, please post here. - How to calculate condo association fees - garages included?
I live in a condominium in Louisville, KY and my question is on calculating condo association fees. These condos consist of 4 to 6 units a building much like patio homes. Some units have attached garages. It cost additional money for condo association insurance & repairs on the garages. I am trying to find out if there is a rule in Kentucky on how association fees are calculated. If the condo association bylaws state by square footage does this include the garages? - What happens to condo owners when the State and IRS issue liens?
I own a unit in a 182 unit condo in Florida. The State of Florida has a tax lien of $11,000 on the Condo Association and the IRS is going to lien for in excess of $98,000. The Condo Association does not have the money to pay the back taxes and penalties and interest. What happens to the owners in this situation? - Is it discriminatory to make HOA owner get rid of pet bird?
If a condo HOA allows pets in a few buildings but not in others, is this legal or discriminatory? Our building allows pets and a neighboring building neighbor wants a house pet that does not go outside a canary in a cage. Can they make her get rid of the bird? - HOA board forcing out president with 3 strikes missed meeting policy
Two HOA board members (directors) are calling for board meetings. The president of board has a full time job and doesn't get out of work till 6pm. These directors are calling meetings at 5pm, knowing full well she cannot attend. They are trying to use the HOA rule: Miss three meetings and your removed from your office. This rule has never ever been used or enforced in the past. Their whole intention are to appoint another person as President. These two directors have in the last 6 months fractured the HOA board. This is taking place in Florida. Is there any recourse the President has? One meeting was called on a Friday at 5pm the other now is two days later on Monday at 5pm. Any suggestions would be helpful. - We never keep condo association board meeting minutes. Should we?
I understand that a condominium board is to keep executive sessions board minutes. These minutes are private and are for the board members eyes only. I live in Washington state and my condominium association board has never kept these minutes. I think that these sessions should be documented. Am I right? - Can HOA owner in foreclosure stay on the association board?
Can a unit owner who is in foreclosure proceedings for their unit, but up to date on monthly assessments, hold a position on the board? This person has been on the HOA board in previous years and feels they have the right to participate again. The current board feels that this person is irresponsible financially (known to have refinanced home several times to live off the equity earned during the boom years, and now purposely not paying mortgage to try and refinance home back to a much lower mortgage rate). This person has made poor decisions on previous boards and has been belligerent and bullying as well. We will have several openings on the HOA board this year with few people willing to fill the vacancies but don't want this person as they are counterproductive. What can we do? - Our condo association can't afford its own special assessment
Our complex is looking to ask for a 25K assessment per unit. How do people pay this type of assessment? That is a huge sum and I don't have that kind of money sitting around. It is hard enough in this economy to make my mortage payments. Do owners have to come up with the money up front even a payment plan would be hard for me? I doubt in this economic climate that some owner will be able to pay so this could be even high too. Learn about HOA loans - How are condo association or HOA assessments calculated?
How are assessment fees figured? I live in a building and have found that units larger than mine pay less than I do. Is it based on cost of living or something and dependent on when you buy? - Why wont most banks provide loans to a condo association or HOA?
Our Condo Association has contacted several banks, including the ones that can be contacted directly through this website. However, because our Association is comprised of 14 units, no lender will even contemplate giving us a loan. We have several projects we would like to do, one for recaulking/flashing of the building exterior, the rest are for system upgrades and energy efficiency. Total cost of about $34-36k. Our reserves stand around $20k, and of course no one wants to do a special. The building is 8 years old, meets all the % requirements for occupancy, delinquency, and ownership spelled out in most articles and blog posts concerning HOA loans. We understand the idea behind spreading around the risk, etc., with larger Associations. We just don't understand why with "so many" lenders originating loans to HOA/Condo Associations, why no institution will even look into providing our Association a loan? Does anyone have any experience or knowledge of a lender that will at least work with us rather than just saying no when I tell them we have 14 units? Has anyone ever escrowed part of the reserves at collateral, in addition to assigning collections rights of the assessments as part of a loan? Thanks ~ - Condo association has lawyer collecting late fees with no warning
I have been paying my condo association fees by automatic payment for 2 years. It looks like in December the Condo Association set up a special assessment ($70 for 6 months) which somehow I was never notified. Now I got a letter from the attorney that I owe over $1,300 (attorney $525 plus extras fees and penalties). If I don't pay within 30 days they will record a claim of lien against my property. I try to contact the property manager of the association. He doesn't know anything. He sent me to call the lawyer. After 4 days trying to contact the lawyer and explain all the situation nothing change. I don't understand why the condo association never contact me ??? Thank you Gisela - 3 Steps To Collecting Delinquent Condo Fees
Most HOAs and Condo Associations have some level of difficulty collecting delinquent condo fees and assessments. There are 3 actions a Condo Association or HOA can take to collect. Send Notice of Demand for Collection (NOD). Although Notices of Demand are often sent by lawyers, they can be sent directly by the association. This document put the delinquent owner on notice and informs them of the HOA or Condo Association's right to place a lien on the property. Record Liens. Liens alert lenders, purchasers and title companies of a "cloud on title" that needs to be cleared up. For this reason, long standing delinquencies often get cleared up at refinancing or sale closings. A recorded lien improves the odds of collecting even if an owner files bankruptcy or a lender forecloses. If the lender forecloses, the association can collect if there are surplus proceeds. If there is no lien and the property is sold, the association has no claim. Let the Attorney Handle It. After several rounds of written notices and 60 days have passed, turn the matter over to the HOA's attorney. Cease communications with the debtor. Referring all calls to the attorney will expedite the process. Learn about Condo Association Insurance and HOA Loans - Condo Associations - How To Make Your Own HOA Demand Letter
In today's environment, most condo associations and HOA's are dealing with delinquent condo owners and late or unpaid condo fees. Condo Associations must get proactive and help themselves get paid. Sending an official 30-Day Notice of Demand for your Condo Association or HOA is the most impactful, yet cost-effective way to make delinquent owners pay. Traditionally, about 30%-60% of delinquent owners pay, in full, upon receipt of initial demand and collections letters. The first step can be to send a payment demand letter, which the condo association board can do themselves. This letter put the delinquent owner on notice that the association has the right to place a lien against the condo owner after a certain amount of days. Each state is different; make sure to look up your state's law on liens. Here is what is normally included in an HOA payment demand letter. This is the most impactful, yet cost-effective way to make delinquent owners pay. Delinquent member notified of outstanding balance and Association's right to take legal action in 30 days in the form of a lien. Delinquent member notified of outstanding balance and Association's right to take legal action in 30 days in the form of a lien. Letter also notifies delinquent owner that the association is considering a 3rd party collection option. Notification strongly recommends delinquent member directly rectifies outstanding debt with association prior to end of 30 day window. See a sample HOA payment demand letter from our download section - Condo Association or HOA Collection Policies for Fees and Assessments
Assessments are the life-blood of condo associations and HOAs. Yet only in a very fortunate few condo associations can collection of assessments be left to a laissez faire process. Most condo associations need to have a cohesive and consistent collection process to thrive and not merely survive. This article deals not only with the process of collection of assessments, but also the philosophy of assessment collection adopted by an association. COLLECTION PHILOSOPHIES Whether they realize it or not, all associations adopt a collection philosophy. Some do it unwittingly and without realizing what they have adopted; others deliberate and consciously adopt a philosophy which tailor-fits their members and the community in which they all live. Collection philosophies run gamut from "associations are businesses and must be like businesses" to "collections are a messy matter perhaps if left alone, the goodhearted volunteers will pay enough to cover expenses." Most associations probably fall somewhere in the middle of the spectrum, but every association should periodically reexamine its collection philosophy. One way of doing this is by preparing a TQM style mission statement. A sample mission statement of collection of assessments for one condominium association might look like this: 1. We want to collect as close to 100% of assessments as humanely possible. 2. We believe in constant communication with co-owners as the cornerstone of an effective collection policy. 3. The collection process should provide for graduated sanctions for untimely payments. 4. The collection procedure must be clearly and often communicated to all co-owners before there are delinquencies. 5. The collection procedure must be written and made a part of the governing documents of the condominium. 6. The collection procedure must be enforced in a consistent and uniform basis. 7. Co-owners must be treated with respect throughout the collection process. This "mission statement" is for illustration only and not to promote any particular philosophy. But it is important for the association to look at itself and its members and put some thought into a mission statement or philosophy that both suits its members and will result in effective collection of assessments. The centerpiece of an effective assessment process is an administrative resolution setting forth the association's policy on collection of delinquent assessments. Enacted by the Board of Directors and promulgated to all co-owners, the administrative resolution in sometimes incorporated into the Condo Association's Rules and Regulations. In either form, it is the association's written statement of assessment enforcement practice. Its purpose is simple: to communicate to all owners exactly what actions the association will take to pursue delinquent assessments. Since assessment resolutions will differ as associations' policies on assessment differ, there is no one universal resolution. A generic assessment resolution might provide the following: 1. Assessments are due on the first of the month. 2. After a 10 day grace period, late charges apply. 3. A notice of Intent to Lien is sent to owners more than 30 days delinquent. 4. A condominium lien is recorded against any unit owner more than 45 days late. 5. Acceleration of all assessments to end of fiscal year (if allowed in condo documents) for delinquencies of more than 3 months. 6. Lien foreclosure is directed for delinquencies of more than 4 months. 7. After institution of lien foreclosure action, all payment plans or settlements require board approval. What is critical is that the resolution be memorialized, enacted by the Board, disseminated to all owners, and most important, that it be timely and consistently enforced. ENFORECMENT MECHANICS Notice of Intent to Lien. The Notice of Intent to Lien is normally sent to the delinquent owner by the management company or, if the Association is self-managed, by the Association Treasurer. It serves as both a warning regarding the imminence of liening the unit and the final non-legal request for the co-owner to become current in payment of his assessments. Lien recording. The recording of a lien against the condominium unit is the most important action the association can take. It secures payment of the delinquent assessments and acts as a "wake-up call" for the delinquent owner. Because the Condominium Act sets forth strict and explicit requirements for a valid condominium lien, the preparation, recording and service of the lien is best handled by the association's legal counsel. The condo association and/or its management company can facilitate the lien preparation process by ensuring that each owner's unit file contain certain essential information, including: (1) Unit number; (2) Copy of the owner's deed; (3) Mailing address for owner of record (particularly if a non occupant owner); (4) tax identification number for the unit; and preferably (5) a clear unit ledger reflecting assessments, late charges and legal cost separately and identifying any payments maid by the owner as well as the current balance. Once prepared by the lawyer for the association, the lien must be timely recorded with the county register of deeds and served on the o-owner. Acceleration of assessments. Some, but not all, condominium documents provide the association the right to accelerate the balance of the fiscal year's assessments in the case of default. Where the documents do so provide, the association must consider the best way to exercise this significant power. If the collection process is designed to provide increasing sanctions for delinquencies, the seriousness of assessment acceleration must be weighed in deciding its timing. It is particularly essential that associations exercise acceleration of assessments on a constant basis (i.e., when a four-month delinquency exists). Foreclosure of the condominium lien. The most difficult decision made by an association board is directing legal counsel to begin foreclosure action on the condominium lien. Some associations prefer to wait until a certain minimum dollar amount of delinquency has been exceeded. This approach can create problems particularly where particular payments have been accepted. This writer recommends foreclosure action be keyed to a specific number of months of delinquency rather than a dollar amount. The association must also decide whether to foreclose on the condo lien or to sue for damages only in district court. Foreclosure can be effected either by advertisement or by judicial foreclosure. Choosing the correct enforcement mechanism requires close analysis of the factual circumstances and is best left to the discretion of the association's counsel. Each process has advantages and disadvantages. Foreclosure by advertisement is relatively inexpensive but does not allow the association to pursue the co-owner for damages if there is insufficient equity in the condo unit to recover all monies from the foreclosure sale. A district court unit for damages is faster than circuit court action, but such a judgment is only as good as the collectibility of the delinquent co-owner, and such a judgment can be nullified by a bankruptcy. Judicial foreclosure provides the most flexibility and protection to the association, but requires a lawsuit in circuit court, is expensive and time consuming. Both judicial foreclosure and foreclosure by advertisement culminate with an advertised foreclosure sale, at which time the association normally bids in the total delinquency including legal fees, costs and interest. If substantial equity exists, the association must instruct its counsel whether to respond to an "overbid" (i.e., a third party bid higher than the association's bid). Throughout its process, the association and its counsel must keep diligent tabs on possible foreclosure action by the first mortgagee, bearing in mind that a first mortgagee foreclosure will "wipe out" the association's position (unless the association redeems from the mortgagee foreclosure sale). Redemption Period. Assuming to overbids, a foreclosure sale will produce a Clerk's Foreclosure Deed, which must be recorded at the register of deeds office, reflecting Association's ownership of the foreclosed unit, subject to the first mortgage and subject to the owner's right of redemption, which normally is six months. During the redemption period, the Association and its counsel must frequently monitor for any foreclosure proceedings brought by the first mortgagee. Typically if financial circumstances cause a co-owner to be unable to pay assessments, the co-owner will ultimately default on his first mortgage, and the mortgagee will pursue foreclosure by advertisement. Often, there will be only a relatively short "window of time" within which the Association will have unit, ownership before the first mortgage sale, and the Association needs to take aggressive action to market the nit to recover its investment. Collection of Deficiency Judgments. In many circumstances, there is insufficient equity in a unit and foreclosure may not make financial sense. The alternative is pursuing the co-owner for a deficiency judgment. However associations must understand that a judgment does not automatically translate into payment. The co-owner must be collectible and the association must affirmatively pursue collection action, by garnishment either of wages or bank accounts, or by attachment of non-exempt personal assets. Associations are advised to take preparatory action by maintaining copies of co-owner's checks in their unit files and learning, if legally possible, employment information regarding co-owners. CONCLUSION Enacting a comprehensive administrative resolution on assessment collection procedure and adhering to it ion a consistent basis is the best hope for a condominium association to minimize uncollected assessments. Learn about Condo Association Insurance or HOA Loans - How do we fund HOA projects with delinquent owners?
Our condo association board has had some concerns about enforcement of a $17,000-$20,000 special HOA assesment that is needed for a siding and woodwork total replacement for our 262 unit 42 building condo community. I have heard that forced forclosure on delinquent condo owners may not be all its cracked up to be becuase if the property does not sale - the HOA could be liable for some costs. Currently we have a 47% delinquency rate. I'm out of options of how to actually get repairs / projects completed without a more strict enforcement besides a lien. Any suggestions or direction ....thank you! Angela - How to enhance condo association collection efforts
I am not a member of our Condo Association Board of Directors, but my wife and I are owners in a condo. I believe that the property management company that collects past due condo association fees is not particularly effective in its efforts. The management company uses perfectly legal but highly bureaucratic letters to do the condo fee collection efforts. Are there any creative legal actions, letters and communications that can be used speed up such collections? The condo association board seems afraid to make waves in the fear that the various homeowners will not pay. - What info would you like to see on CondoAssociation.com state pages?
We'd like your feedback - We are getting requests for more localized content and resources, so we are considering building out state pages. We want to ensure we understand what the CondoAssociation.com community is looking for. What information, data, and/or features would make your state page interesting and usable to you? Thanks! - How best to oust failing condo association board president?
Condo Board President will not let go! The tension in my building has become almost unbearable due to the Condo Board Elections that are coming up on August 17th. The current Board President has been in this position for the last 7 years and has run unopposed until now. I am running against her and she is trying to do all she can to derail the election. It has gotten somewhat personal with nasty emails going out and since there hasn’t been any consistent communication, unit owners are alarmed and confused. The crazy thing is that I can’t understand why she wants to continue with this position as she always claims she is so busy and is never home, not to mention she has not fulfilled her duties as president and the building is in disarray. With the current Condo Board we have received no annual budget, no list of expenses and projects, no Board meeting minutes, nothing for the last 2 years! She hasn’t held the other members of the board accountable to ensure this information gets out to unit owners. It has gotten to the point where another Board Member demanded she resign and hold an election (there hasn’t been an election since 2008). I really have no desire to get involved in this mess but I feel like I have no choice or it will end up costing everyone money in the end either through a serious building repair that has been neglected or a lawsuit from the elevator that is not up to code or maybe it will be the dark stairwell that someone falls down because the elevator is broken! Does anyone have suggestions on how to approach this? Do you think the building maybe at the point of contacting a lawyer? My state, Illinois, has recently passed some legislation that might give owners more leverage than in the past but I am not sure I want to take this route. - Are there standards or rules for condo association reserve funds?
Are there accounting or other professional group standards that deal with what items may be included in a condo association reserve fund and whether the funds may be expended for items not originally specified for inclusion in the fund?. A corollary question is whether there are items that these groups recommend or require to be included? Our reserve fund has been funded for many years based on original and updated reserve studies. We are now faced with an unanticipated expense arising out of unusual rainfall and are uncertain whether it may be or should be funded out of the existing reserves. - Can condo association force out owners of oversized pet dog?
I signed a year lease to rent a condo that stated I have 2 dogs and paid a $200 pet deposit, now the Property Manager for the condo association is saying we are in violation of rules and regulations. We were never provided a copy of these rules and can not find on internet. Other tenants have big dogs as well and the limit is supposedly 25 lbs. If our lease states we can have dogs and were never provided rules and regulations, can the condo association force us out of a year lease?