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| Providing Community Association Insurance for over 25 years: D&O Liability, Crime Products, Umbrella Coverage and Property Manager's Errors & Omissions Liability. |
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MichelleW
(Texas)
Posts:25
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| 07/31/2006 10:39 AM |
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I was given the advice on this site for our Board to develop lien rules to distribute to all of the owners so they know in advance what will happen if they get deliquent on their dues/assessments/etc. Rather than re-invent the wheel, does anyone have examples of such guidelines? Our TX Bylaws are pretty general and simply state the Board can file a lien if assessments aren't paid, but I'm looking for guidelines as to when that should happen (i.e., dollar amount or # months deliquent in HOAs), what fees we should charge for having to file the lien, what late fees we should charge (percentage or flat rate, etc), and any other crieria that may be important to let owners know in advance (i.e., given at time of purchase and reviewed with owners at the annual meeting).
Thanks!
Michelle |
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RogerB
(Colorado)
Posts:3726
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| 07/31/2006 10:58 AM |
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Michelle, some states require notification to the owner at least 30 days prior to filing a lien. The dollar amount we file equals the total amount delinquent including late fees plus a $100 filing fee. Following are the guidelines we have developed:
Rules and Regulations on Delinquent Assessments
Assessments are delinquent when payment has not been received by the due date. A 10 day grace period is provided for receipt of payment after which the property is assessed a late charge of $10.00 per month.
Assessments may include, but are not limited to, the annual (regular) assessment, special assessments, late charges, interest, fees, fines, attorney fees, collection costs and court costs. All costs related to a delinquent account shall be assessed to the property and paid by the owner. The Declaration (Covenants) establishes that an assessment is a continuing lien upon the property and a personal obligation of the owner.
The annual assessment is determined by the Board of Directors as part of the annual budget. The annual budget is ratified, or vetoed, by homeowners at the annual meeting. If the members veto the budget, then the prior budget, including the annual assessment, remains in effect until a new budget is approved. The annual assessment may be paid on a quarterly basis with payments due on the first day of each quarter beginning January 1st, April 1st, July 1st, and October 1st. Assessment payments shall be applied to the oldest assessment first and progress toward the most recent assessment.
Statements may be provided by mail, e-mail, or coupons as a reminder to homeowners of the amount and due date of a quarterly assessment. Nevertheless, it is the responsibility of the homeowner to remember to pay by the due date even if a statement is not received. An owner may request consideration by the Board of Directors to defer payment due to extenuating circumstances.
An account delinquent over 10 days will be charged $10.00 each month it maintains a balance over $10.00. If a check is returned the account becomes delinquent plus there is a charge of $35.00 for the returned check.
An account delinquent over 70 days shall be provided a warning that a lien will be recorded on the property if payment is not received within 30 days.
An account delinquent over 100 days will have a lien filed with the Douglas County Clerk. The lien amount will include a filing charge of $100.
An account delinquent over 130 days shall be provided a warning that the account will be referred to an attorney for collection if not paid within 30 days.
The Association shall make a good faith effort to resolve disputes first with the Owner. If resolution is not reached the Association stands ready to go to binding Arbitration under the Uniform Arbitration Act. The parties are herein forewarned that if court proceedings are necessary to resolve a dispute, the court shall award to the prevailing party reasonable collection costs, attorney fees, and other costs.
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Roger Borcherding
Official HOATalk.com Sponsor
DARCO Property Management (Colorado)
(303) 925-0150 
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