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Subject: Biggest Challenges for Today's Associations?

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Jadedone4
(Virginia)

Posts:495

12/16/2007 5:49 AM
JamesC, I do understand your pain - I am a new President of an HOA, undergoing transition, and while the community that I live in now is less than three years old, we have folks owing the HOA in the $3k range (as in at least five). While it is not an easily accepted "explanation" the current housing market crisis, or rebound, depending on who you talk to - did and will play an enormous role in assesment/dues payments and collections. My sincere advice to you... put the guy out of your mind ! PERIOD !! Focus on either finding a better management company, attorney, etc that will aggressive (and properly) seek out payments owed to the HOA by ALL residents - and not those in awful states of arrears. Yes, I agree with you that those who are not paying are getting a deferred "free" ride; at the expense of others. However, you still have a responsibility to the other owners, and the reality is that the world still turns and expects to turn for the other residents. I am willing to wager anyone here that those who habitually fail to pay assessments fall into one of two main categories; ignorant of the rules, or well versed in what the rules are and choose to ignore. Everyone of us here has had a month where we paid assessments a little late, with or without the late fees, etc - but we made sure we paid. Those that are ignorant to the rules, are still adults and should know better. It is the class of folks who know the rules, and "play the game" in hopes that there is an advantage to them later on - simply want to skirt responsibilities. For the latter, let the attorneys deal with them.... On to the original post - I'd have to agree with all here, APATHY is what really creates failings in HOA's. I have heard some here mention that poor board communications; boards gone bad; etc - and in now way am I, or would I, trivialize those situations; however, boards are made up of neighbors. And if the neighbors are putting forth the effort (for whatever reason), and successfully convincing others to put them on the board, oh, well, then you have to either get more involved, devise better positions/tactics, etc, or accept it. Might not be palattable to many to have to accept the situation, but the reality is that nothing worth having comes easy. I bang my head everytime I hear owners ask me why "I" made such and such decision, when there is a board decision. Or when a board member clearly has a personal agenda and puts forth a bad vote, or request for vote on services, etc. It all goes back to the general theme - COMMUNITY!! If you want a great community you have put in great amounts of work. If you want to sit on your backside and complain, you get just that. Don't "let" them control your community, your investment, your lifestyle - without input from you and your neighbors. But also do not site idle, and then complain about things changing and you not being "part" of the process; if you didn't make the effort. I agree that more and more communities are HOA/COA/POA, etc - and our general federal and state legislatures need to be more involved. However, when we have no funds coming from Community groups to fund changes - and the other side of the table (SOME management companies, attorneys, etc) have a well supported voice - well you get the levels of laws/codes/oversight that we have now. My $0.13.... anyone got change, because I think I got a Canadian penny slipped to me...

RobertR1
(South Carolina)

Posts:2074

12/16/2007 6:44 AM
James, If your lawyer is right that you will be paid upon sale, then he must think you already have a lien on the property. What does your documents say about leins without foreclosure? I'll tell you straight Jim, you live in a fair sized metropolis. Are other communities suffering under like circumstances? Are you saying you are supplying these people with water, trash and maintainence and they are paying no one for this service. Didn't people sign contracts when they moved in? Is this some kind of subsided government housing, maybe a HUD project. There has go to be more than what I am reading. You pay a contractor to pick up trash and the contractor picks up the guys trash? Give his neighbors tags to put on their trash and tell collectors not to pick up his trash, then call the cops and report him for littering. There is no shut off valves to each house? Install one and put a lock on it after tell hime that is what you are going to do. Don't do any maintainence for him at all and notify him why. I am sure you know there is something very wrong here. If your lawyer says don't worry about it because you will get your money when he sells, is only telling you half the story, if there is no equity there is no money for you. You are not first in line if foreclosure happens. You may not be first in line if he sells. Roger says lein the property........good advice. To your board. Use every available resource to stop the practice, and if they allow it to continue, they are part of the problem. Use a collection agent. Get a new lawyer immediately and give him the problem. How about the county regulators and the state, how about your county council and your legislation. How about telling what else is involved in this. Your board has a legal obligation to be responsible and handle your funds correctly, they are liable personally for this obligation. Your insurance does not cover misdeeds. I would call a special meeting of the Board, mutually decide this has gone far enough and lein the guys property. I would make sure minutes of the meeting were recorded and votes taken and recorded and by the end of next week your new lawyer should have a registered letter going to all these people (not just one, all)to the effect they are going to be cited by the proper officials for non-payment of a legal debt.

RobertR1
(South Carolina)

Posts:2074

12/16/2007 6:58 AM
Jadedone, Nice post. I think we agree, this should not happen, boards are mandated to handle the problems, they are libel if they don't, they need a new Lawyer to start, there are probably resources with the state legislation to support actions, the issue here is not the no-payers, the issue is how to correct the problem, community is often overlooked in solving problems, who care if thyis gut owns ten properties, the point is these people have a legal debt they should pay. My report is tempered because I am very upset because I see this from the owners side and am insulted because the elected members are not acting to safeguard my money and in fact are costing me money I never agreed to provide.

RobertR1
(South Carolina)

Posts:2074

12/16/2007 7:06 AM
Jadedone, I think some one slipped a little in your coffee this am. It is ,"My 2 cents worth", not 12, and if you got a Canadian penny slipped in, you got a good deal.

RogerB
(Colorado)

Posts:3694

12/16/2007 9:24 AM
Collection of assessments seems to be a big problem for some associations. Following are procedures we recommend. 1. Establish rules and regulations (policies and procedures) for collection of delinquent accounts which are in accord with your CC&Rs. Hopefully they allow late charges, lien, and foreclosure. Provide copies to all owners. 2. The late charges should be high enough to encourage payment of the assessment over other bills when an owner must decide which payment(s) to defer (example: $10 for a few short term delinquencies and $25/month for many or longer term delinquencies. For extenuating circumstances allow for waiving the late charge. 3. Give 30 days notice of intent to lien when an account is over 2 months delinquent. 4. For accounts delinquent over 3 months file a lien. Make the lien filing fee sufficiently high to encourage payment prior to filing. We include the cost of filing notice of lien and for later filing the release of lien. 5. Provide owner a copy of the lien and notify them that if not paid within 30 days the account will be turned over to an attorney to garnish wages and if necessary foreclose on the property. Continue to file late charges and also consider charging interest at 1% or more per month on delinquent accounts over $xxx,

Roger Borcherding Official HOATalk.com Sponsor DARCO Property Management (Colorado) (303) 925-0150 *See legal notice below (end of page) or go to www.hoatalk.com/legal

JamesC
(Maryland)

Posts:128

12/16/2007 11:54 AM
Reading these post, and I don't want to center the conversation around our problem, but as I read it goes back to "FRUSTRATION". To Jadedone4: It is difficult to put this homeowner out of one's mind when as a board member I have to be a part of the process to collect fees owed to the community. Going by his residence, and seeing the two new BMW's, truck, and new van I have to realize he is not distitute as to where he can't afford to pay the fees. Plus he is collecting rent on the two homes he owns in the city. To RobertR1: We have gone through the lien business after he missed his first 90 days of not paying. To avoid going to court he berbally agreed to get caught up on his fees by paying $200.00 a month. That stall lasted for three adfditional months. He now agrees to pay all of it by the end od December. Rest assured, this will not happen. e knows the ropes. And "NO" our community is not a governnment or hud project. We are not amongst the highest in the state by no means, but all the homes sell in the 250k range. To RogerB: Yes we have liens against this, and six other homeowners. Anyone past the 20th of the month is charged $15.00 late fee. Everyone pays with the exception of these seven. I will tell you the solution I want the board to implement, and am somewhat confused when the management company says we can't. All board meetings are open to the homeowners of the community. Our attorney says we are not legally bound to "NOT" mention at these meetings the names of the homeowners who are late, so anyone at the meetings can hear our conversations.. We record the minutes of the meetings where the same information is placed, and then we publish the minutes of our meeting on the community web site. I want to put the information in our newsletter, because as a private HOA, every homeowner in the community has a self interest in everything that goes on, but not all are registered on our site. (about 77 are out of 167 homeowners) The attorney says we can't because it has something to do with the privacy act. If those attending the board meetings can hear it, and we put it in the minutes, that is then published on the web site?????????????????????????? Anyway I do appreciate being able to vent my frustration, and appreciate all the reads on this post. I will print the answers I recieved starting with Robert's, and going through Roger's, and take them to out next BOD meeting in January. Jim

DonnaS
(Tennessee)

Posts:2796

12/16/2007 1:58 PM
James, I am sure that we all have symapthy for your association because we all have had 1 or more of these same kind of members , doing the same things. We have gone to lein a few times in 3 years and that is just a temporary bandaid on our inability to keep up with our expenses. Most leins never get paid because as we learned, we were not on the top of the collection list. Now, as much as you would love to publish the list with the "slackers" names, you cannot do that. You won't shame them into paying and probably will make them really mad. Your attorney is correct and you pay him for that advice, so heed is opinion. At a meeting where we had to decide to lein or not(all of our meetings are required open), we had given each Board member, a list with the members name being replaced with # 1, # 2, etc. We knew who they were but it is NOT business of the membership in general, once the attorney gets involved in possible litigation. And the fact that all members are not on your web site, then only select members will be given this information. So my best advice is, Do Not Publish Names.

RobertR1
(South Carolina)

Posts:2074

12/16/2007 3:36 PM
Jim, If you have a Lein on these people and it is registered and filed at the Court house, the information is in the public domain. Ask your lawyer about that. It also appears you are getting no help from your management company, is this company a hold over from the developer. Please, go to your state web site and search for State Statues abour HOA's and POA's. I know that this has come up about Maryland Acts recently that invvolved some new commission for HOA. Search Montgomery County Home Owners Associations, I think I saw it there.

PaulM
(Pennsylvania)

Posts:1347

12/16/2007 4:22 PM
JamesC: While it is true that to post one's name as being delinquent, it is not advisable as your attorney has counseled you. However, there has been some discussion on this site about just noting the address numbers (no names mentioned) of those delinquent. Something to check out with the attorney. If that doesn't work, perhaps you can include a blurb in your newsletter about ...many residents are not fulfilling their responsibility of paying assessment fees which are due...process is lien and foreclosure(?)...puts a greater burden on the community as a whole...operating income is minimized, maintenance suffers, blah, blah, blah... At the very least, they know who they are and they may feel inclined to step up to the plate and fulfill their responsibility. Good Luck!

TracyT
(Maryland)

Posts:220

12/17/2007 10:10 AM
Hi guys, I can tell you that there is nothing in the MD HOA Act that governs collection of assessment (other than what James said they are doing already) or enforcing individual convenants. The one thing James has going for him in the Act is that all real estate transactions in an HOA (COA, COC etc.) must be disclosed at the time of contract. In fact, receipt, understanding and acceptance of the covenants is amended to the contract and settlement process/documents. The guy can't say he didn't know there was an HOA (rules) and he can't claim ingorence. This of course will be more helpful for the covenant and parking violations where a suit can be brought in court for non-compliance but apparently not for the collections. Whether or not you can foreclose for non-payment of dues should be in your documents. Robert, I believe the HOA commission that you are speaking of issued their report in Dec. 2006. I have not seen anything new posted the MD General Assembly web site. When I spoke with the Maryland Homeowners Association (in Montgomery Co.) they had hoped that the report would have covered many other areas of concern and contain much more detail for resolutions. That being said they are an excellent source of information and support. If you are concerned about the performance of you management co. and/or attorney you could bounce it off them as well as maybe network on successful collection practices. Good luck

GloriaM
(North Carolina)

Posts:778

12/18/2007 10:48 AM
In the "green state" of NC: 1. Foreclosures & bankruptices 2. First time home buyers in an HOA not knowing or understanding the ins & outs of HOA's. 3. Management Companies with no experience starting up with no credentials. 4. Lack of knowledge amongst HO, boards and committees and sadly yes, even management companies. 5. Local and federal goverment not stepping up and assisting HOA's with the numerous problems that exist in transition from Developer to HOA, as well as the horrific things I have seen when a new community comes on. I can go on and on, but I have a doctor's appointment so I will stop here for now. lol

Dr. Gloria J. Martinez, CFO Official HOATalk.com Sponsor Author of "A Guide to Community Living" Faith Management Services, LLC (North Carolina) (704) 799-3791 www.FaithManagementServices.com *See legal notice below (end of page) or go to www.hoatalk.com/legal

JeanneK3
(Maryland)

Posts:129

12/18/2007 11:00 AM
I think the biggest challenge is educating Boards as to their fiduciary responsibility to the community. Second is educating homeowners as to the risks involved in not being involved in their association. Third is antiquated state laws. Maryland has been described as a "rocket docket" state meaning that someone can foreclose on you and take your house in 15 days without ever sending you a notice that foreclosure is imminent. It doesn't get worse than that.

GloriaM
(North Carolina)

Posts:778

12/18/2007 12:55 PM
JamesC: You might want to check with Maryland law and see if it is legal for you to turn off the Owners water. When I had my business in NJ, I turned off an Owners water for over 3 years of non-payment (I was only working with them for 1 year) and was successful in turning it off and winning. If the water department can turn off services for nonpayment then why couldn't the HOA?

Dr. Gloria J. Martinez, CFO Official HOATalk.com Sponsor Author of "A Guide to Community Living" Faith Management Services, LLC (North Carolina) (704) 799-3791 www.FaithManagementServices.com *See legal notice below (end of page) or go to www.hoatalk.com/legal

CarolG
(Alabama)

Posts:7

01/06/2008 7:17 PM
Patrick h - California - you are so right. so many homeowners of condos that have never been on the Board don't think in this way. For some reason the minuet a resident becomes a Board Member they are looked at as the big bad wolf. I think this is also a real problem. Residents who don't care to be on the Board should really be so thankful that some want to take their time to do a thankless job.I know that was a little off the subject but Residents really need to think and completely understand that their has to be a Board of their Assoc. Also Board Members need to realize that it is a honor to be elected and serve on the Board. You have been chosen to handle one of the biggest investments most people make.

JustinM1
(North Carolina)

Posts:22

01/07/2008 8:53 PM
I believe the biggest issue is the continued "us vs them" mentality. By that, I mean those on BOD's vs Homeowners. Even here (and granted I have taken this to be a bastion for BOD's) there is little discussion of better communication with homeowners, of BOD members getting consistently up and getting out, seeking out the people who they proport to represent. Apathy? Sure, its absoluteky an issue, but as I have seen here in my own community, when people take the time to get out and talk to each other, when they invest mot just time on a computer, but time on the sidewalks, there is a lot less apathy. Apathy, in my opinion is the result of the bigger issue, not the root cause. Justin

RobertR1
(South Carolina)

Posts:2074

01/08/2008 5:07 AM
Justin, You are probably right Justin, up to a point. The hitch comes in the folks that are elected to do a job of managing the complex. Some folks make great board members but just can't do "met and greet well." Some board members have a conviction if I can contribute, everyone can contribute. The biggest evil in all this is the Board takes on the complexion of the President over the years. He tends to gather supporters as time passes, which is a good reason for term limits on the Board and I would like to see the presidents position be rotated. But you know, the communists recognized this shortcoming of management so they broke the population down into areas and in some cities even streets. That way, they felt they could control everyone. They had neighbors spying on neighbors and that is not good either and don't work very well. But they ruled the people with a firm hand. In effect, they did not allow apathy. Probably the cause of apathy is our associations is rooted in the society as a whole. And it becomes less and less noticed as more people take the "I don't have time" attitude. Now the way to combat this is through organization and the way you run the Board. I am not pointing fingers at any board, I haven't the right or the knowledge, but we see some boards are run well and some are not. That leaves the problem of who decides what is good and not so good. It should be a concern to the members that the association is well managed, it should be a concern to the Board that they listen to the members. If they don't, then the Board is entrenched, and needs attention, good boards know this, bad boards don't know what to do about it.

JustinM1
(North Carolina)

Posts:22

01/08/2008 5:28 AM
Posted By RobertR1 on 01/08/2008 5:07 AM Justin, You are probably right Justin, up to a point. The hitch comes in the folks that are elected to do a job of managing the complex. Some folks make great board members but just can't do "met and greet well." Some board members have a conviction if I can contribute, everyone can contribute. The biggest evil in all this is the Board takes on the complexion of the President over the years. He tends to gather supporters as time passes, which is a good reason for term limits on the Board and I would like to see the presidents position be rotated. But you know, the communists recognized this shortcoming of management so they broke the population down into areas and in some cities even streets. That way, they felt they could control everyone. They had neighbors spying on neighbors and that is not good either and don't work very well. But they ruled the people with a firm hand. In effect, they did not allow apathy. Probably the cause of apathy is our associations is rooted in the society as a whole. And it becomes less and less noticed as more people take the "I don't have time" attitude. Now the way to combat this is through organization and the way you run the Board. I am not pointing fingers at any board, I haven't the right or the knowledge, but we see some boards are run well and some are not. That leaves the problem of who decides what is good and not so good. It should be a concern to the members that the association is well managed, it should be a concern to the Board that they listen to the members. If they don't, then the Board is entrenched, and needs attention, good boards know this, bad boards don't know what to do about it. Robert, I can only speak from the experiences I have had here in my community, in North Carolina. For us, one of the biggest hitches is that with the exception of the NC Planned Community Act (and btw, did anyone else in NC see where the court here just ruled that BOD's can't change the CCR's?) is unregulated in how HOA's and the people who make money off of them are regulated. Our previous MC resigned...granted they were already in court on something like three embezzlement charges from other HOA's. MC's in NC are unregulated. Hang your shingle and charge people! The MC's don't work for the homeowner, they work for the BOD. They encourage the BOD to direct questions from the homeowner to the MC, whichc may or may not respond in a timely manner. The MC's encourage separation between the BOD's and the people they are supposed to represent. The apparent use of violation letters and/or fine letters as a BOD "weapon" does not seem to be uncommon, from reading this site and others. Our former BOD forclosed on a Veterans house for $200 in unpaid dues. The man was out of work due to injury and homebound. The people in our community stood up and raised the nearly $1000 needed to get the lien removed. The other $800, of course, is the attorney fees charged back to the homeowner as the lawyer attempts to take their home! If someone from the BOD of directors...who btw, are also supposed to be neighbors...had gone and talked to these folks and said, "hey, we noticed your behind, is everything ok?", I suspect that BOD would have made a friend. We don't act as neighbors anymore; the machinery has become more important than those whom it was supposedly built to serve. Justin

RobertR1
(South Carolina)

Posts:2074

01/08/2008 5:53 AM
Justin, Your last. Tell us more about this NC law about amending CC&R's. Did the Boards have the authority to change them? What prompted this? I understand your problems with CM does bode well for a favoable opinion, but I have met some folks through this site that are professional and extremely smart, and I would trust their wisdom and judgement in managing any association I am living in. There are good managers and some not so good and some terrible, I support the good ones. I have personal knowledge about a Professional Accredited Manager. She has worked wonders.

JustinM1
(North Carolina)

Posts:22

01/08/2008 9:26 AM
Robert, http://www.aoc.state.nc.us/www/public/sc/opinions/2006/640-05-1.htm Also, I agree with you that there are good people here. I think there are good people everywhere; some of the ones here have helped me tremendously in understanding some things I did not before or informing me of things I had no idea about. Jan telling me about loss of liability insurance stands out and is something my wife and I are acting on now. Justin

SetenaN
(Georgia)

Posts:23

01/10/2008 2:11 PM
Having the backing from the laws of the county and state. county and state of course supersede, but it makes it hard to enforce some of the covenants. Example-no parking on the street. We have this rule, but guess what? they can park there because it is a public street. If you fine and go to court, then it will most like ly get thrown out because county and state law supersede.

RobertR1
(South Carolina)

Posts:2074

01/10/2008 2:38 PM
Posted By SetenaN on 01/10/2008 2:11 PM Having the backing from the laws of the county and state. county and state of course supersede, but it makes it hard to enforce some of the covenants. Example-no parking on the street. We have this rule, but guess what? they can park there because it is a public street. If you fine and go to court, then it will most like ly get thrown out because county and state law supersede. *********************************************** Setena, I think most agree that enforcement of all the documents of HOA and Condos are somewhat of a mess. The States, so consequently the counties, do not want to get emeshed in the enforcement of the documents. Florida seems to try hard but fails, and lots of states ignore the problems altogether, and I agree there should be somekind of uniform stablization of all HOA's. Since this appears it will be years down the road and there are thousands of HOA and millions of members, the good news is that it works as well as it does. If every Association would agree they are going to settle all matters in house things would be better, I think! As an association we tend to over think a lot of things and are not willing to weigh the association as the highest authority, Serve the real property, not any other agendas and decisions are simplified. This may sound like "pie in the sky" to some.

DonnaS
(Tennessee)

Posts:2796

01/10/2008 2:57 PM
Robert, In a perfect world, there would be no need for all of the enforcement messes that BODs and MC have to deal with. No parking on the streets would mean just that, 25 mph would mean 25 mph, paying your way and following your cC&Rs would be a breeze. Unfortunately, there are people in the world who are bone heads and slackers and cannot do the right things except what is good only for them. Florida has a great set of Statutes to aid associations and a large group of dedicated C.A.L.L members, Lawyers and lobbyists who dedicate themselves to yearly treks to our State capital. Does it make the Bone heads and slackers fear reprecussions of not following the program? Not on your life so what is the answer? I Don't have a clue, do you?

RobertR1
(South Carolina)

Posts:2074

01/10/2008 3:16 PM
Donna, As a matter of fact I do have an answer. Let me pick 15 people off this site, appoint them to a national Home Owners Tribunal. The would be paid by the givement, wear white robes and hand down strict laws and doctrines. They would all have drivers because I can't spell chauffers, and make social appearance looking wise and serene. Penalty for not following all dictates is to death by the written word, then shot. I would not ever be allowed to be on the Tribunal, and Gloria and Roger would serve as dual presidents for three years to get the thing running right. You would be appointed special envoy to Florida and have a Rolls and a 70 foot yatch to go from place to place and Brad Pitt would be your toy boy.

DonnaS
(Tennessee)

Posts:2796

01/10/2008 3:52 PM
MAKE IT GEORGE CLOONEY AND WE HAVE A DEAL

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