CCRs regarding late fees

Started by RW1 • 15 replies • 1473 views

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RW1 (Texas)
Posts: 149

Posted:

I Live in FLa.

Regarding fees for late payment of monthly maint. dues:
Our CCRs mention that the "BOD MAY AT ITS DISCRETION IMPOSE A LATE FEE NOT TO EXCEED $25.

If no record of a past BOD "imposing" this "LATE FEE" fee is contained in any previous meeting minutes...
is it legal for them to charge this?

Currently we have 15 days before the $25 late fee is added (as indicated on our payment coupons).

FYI: Prior to the language above (in caps) or CCRs mention the imposition of 18% interest if dues not paid within 5 days of due date.

Thanks in Advance...

RW1

RaymondC (Minnesota)
Posts: 64

Posted:

Past failure to enforce does not negate a rule. In addition at their descretion means just that. When they choose to. The 18% seems to be automatic and not require board action, and it seems that the late fee can be tacked on this, as you present the rules. A careful reading of these sections is in order.

HaroldS1 (Arizona)
Posts: 314

Posted:

Does Florida law address interest and late charge limitation? 18% sounds high. Harold

RW1 (Texas)
Posts: 149

Posted:

Raymond, Harold,

I'm not addressing past failure to collect late fees.

It was stated that "when they choose to" is just that.

But doesn't that have to be recorded? SOMEWHERE?

Wouldn't the meeting minutes be the place (at least) to record it?

They can't, just amongst themselves (the BOD), say yes this month and no next month if they don't "record" it somewhere... CAN THEY?

Thanks in Advance...

RW1

(I love this place (HOAtalk))!!!!

RogerB (Colorado)
Posts: 5,067

Posted:

RW, the Board should vote and pass a motion to charge the $25.00 late fee and record it in the minutes. Also, they should make all owners aware of the late charge prior to initiating it.

NancyD1 (Florida)
Posts: 447

Posted:

RW, "when they chose" should not be an issue. They cannot be selective on charging late fees. What if you and one of their friends were late with the payment, they don't charge the friend but they charge you? The BOD should always charge a late fee (every month). The new 720 states that either a late charge of $25. or 5% of the maintenance fee.

Not charging a late fee before does not forgive them forever from charging one. If it is in your doc's it does not have to be restated or voted on at a meeting. I would state it at a meeting because you can forewarn the HO's.

ReneeD (Illinois)
Posts: 201

Posted:

We are an IL HOA and have a similar situation. Our CCR's state that interest can accrue until payment is received in addition to late fees but the management company, I've been told, only assesses monthly late fees and not interest. Ultimately, whose decision is it to uphold our CCR's? our PM or BOD?
-Renee

DaneC (California)
Posts: 210

Posted:

The BOD is responsible for the running of the Association. The PM is a vendor hired by the Association, to perform tasks as outlined in a contract. You should review said contract, to see if they were directed to invoice members for both late fees and interest.

Be that as it may, if it is considered that the non collection was an oversight, and that interest collection will be instituted, the membership should be advised accordingly.

RogerB (Colorado)
Posts: 5,067

Posted:

Renee, the CC&Rs do not require interest payment, they only allow it. We don't mess with interest because it is usually a very minor amount and too difficult to calculate on an ongoing basis. Last year I posted an example asking for anyone to determine the amount of interest due on a delinquent account. As I recall no one gave the correct answer.

ReneeD (Illinois)
Posts: 201

Posted:

Roger/Dane,
I am not privey to the management contract; the BOD won't even honor my requests to view financials let alone Board Meeting Minutes. However, based on both your responses, it would have had to been a BOD decision. Thanks! -ReneeD

JoeW1 (New York)
Posts: 728

Posted:

Quote:

Posted By RogerB on 09/09/2007 4:11 PM
RW, the Board should vote and pass a motion to charge the $25.00 late fee and record it in the minutes. Also, they should make all owners aware of the late charge prior to initiating it.

RogerB - Why should the Board vote and pass a motion to charge a $25.00 late fee when the CC&R's already grant them the authority? All owners should be aware of the late charge since it's in the cc&r's. I'm all for communicating for reinforcement purposes but as the old phrase goes, caveat emptor.

DaneC (California)
Posts: 210

Posted:

Roger is absolutely correct, it's just not worth it. I have had dealings with over 3,000 Associations, in several States, and I have yet to see interest being charged on a late payment - delinquencies and liens are another matter!

RogerB (Colorado)
Posts: 5,067

Posted:

Quote:

Posted By JoeW1 on 09/11/2007 11:19 AM

I believe the CC&Rs did not specifically state the late fee is $25; rather it limited the maximum late fee to $25. That is why the late fee needs to be established and the members notified. For HOA's with limited delinquencies we recommend $10/month late fee.

RW1 (Texas)
Posts: 149

Posted:

Hey,

Great discussions and info. so far but... I feel as though I didn't do a good job in my original quesion.

If you refer to the original topic message I stated that our docs. stated... the association MAY adopt... (I don't want to type it all again so please scroll up).

My question is that if I can find no record of them "adopting" it, EVER, Is it lawful to charge this just cause the docs. say they have the option (i.e. "may adopt") but never actually voted and recorded the implementation [of late fees].

I know this forum has a very diplomatic slant to it and that is outstanding!!!

But let's face it, sometimes (many times) it is an adversarial relationship between the BOD and the members.

My community is slipping fast due more to BOD and member ignorance rather than apathy. People are apathetic because they think nothing can be done and a misunderstanding of the BOD's actual authority.

I hope this puts the discussion more on a track I intended.

I have many more questions to come since I do believe my BOD is clueless and my rights (and community appearance) are being DILUTED by thier inaction.

Thanks in Avance...RW1

RogerB (Colorado)
Posts: 5,067

Posted:

Posted By RW1 on 09/11/2007 3:34 PM
My question is that if I can find no record of them "adopting" it, EVER, Is it lawful to charge this just cause the docs. say they have the option (i.e. "may adopt") but never actually voted and recorded the implementation [of late fees]. /div>

No. As I previously stated: "09/09/2007 5:11 PM RW, the Board should vote and pass a motion to charge the $25.00 late fee and record it in the minutes. Also, they should make all owners aware of the late charge prior to initiating it."

NancyD1 (Florida)
Posts: 447

Posted:

RW, the doc's state that they "may at its discretion". It is a tool that the BOD may use when and if they want. You do not have to vote on something that is already in your doc's, it is a given. It is already confirmed by being in the CC&R's.

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