As a Board member of a condominium or homeowner association, you know the importance of collecting every owner’s assessment. This money is necessary to maintain common areas, finance community amenities and sustain property values for everyone. When someone doesn’t pay their fair share, it affects the entire community. Your neighbors are counting on you to protect their financial investment, so get tough on collections.
Every situation is unique, so you need a variety of collection methods to be successful. Consult your bylaws and governing documents for collection procedures. If your rules are ineffective or outdated, amend your documents to boost your success.
Some owners simply hit hard times because they lose a job and are earning less in a temporary or new job. This homeowner can’t pay their annual assessment, but permitting bi-weekly or monthly installments may allow them to satisfy the full assessment in a few months. The goal is to collect the assessment, not to penalize your neighbor. Everybody wins when you find alternate ways to accomplish the goal.
Implementing a late fee can also help reduce delinquencies. No one wants to pay more than they must, and a late fee and/or interest can help make the due date a priority for many homeowners. Some also get a psychological boost because they are “saving” the late fee by paying on time. This method usually works for homeowners who have the money to pay, but aren’t meticulous about their finances.
Consider limiting access to amenities for delinquent homeowners. Enjoying amenities that aren’t affordable on their own is the reason why many people choose to live in an association. They like inviting their friends to join them for a dip in the pool. These homeowners don’t want to explain to friends and family that their privileges have been terminated, so they find the money for their assessment.
Seek help from experts in HOA collections if your attempts to recover delinquent assessments aren’t successful. A collection or a property management company can help boost your collection rate. If all else fails, talk to your attorney about starting legal action to help you get the money that’s due to your association. Stand tough because your neighbors are counting on you.
Wise Property Solutions is a property management company serving East Tennessee with offices in Knoxville, TN and the Tri-Cities, TN-VA. Specializing in Condominium Association Management, Home Owners Association Management, HOA Management and Gated Community Association Management.
Tri-Cities, TN-VA: 423-926-7373
Knoxville, TN: 865-643-8989