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RickW
(Illinois)

Posts:160

02/16/2010 7:19 PM
I'm attempting to post on our association website, reasons that owners should pay their assessements in a positive way. I don't want to bring up late fees, collection notices, liens, etc. I was thinking of expounding on the good each and every assessment does for the association as a whole. I did a search on these forums for "Importance of Paying Assessments" and didn't really find anything helpful. Thus, this thread...I'll start by listing a few reasons... 1. Assessments pay for maintaining and upkeep of the association's physical assets which in turn helps maintain and possibly improve every owner's property value. 2. Proper budgeting of assessment fees allows the ability to build a reserve fund to pay for capital replacement. This can prevent an association from becoming unkept, struturally unsound, and undesireable. 3. Paying assessments can mean you do not have to provide your own landscape maintenance or snow removal. It can assure owners that all properties/units will be maintained to the same level. 4. Paying assessments can fund a professional management company to facilitate and guide the association. 5. Assessments can fund beautification of the common elements. It can help make your home inviting for you and guests. Please help me in posting the Top 10 (or more) Reasons to Pay Assessments. Thanks Rick

AnnaD2
(Florida)

Posts:924

02/17/2010 5:13 AM
Those all sound nice. At one time people were questioning where EXACTLY their money was going. So I broke it all down for everyone. I started with their monthly (personal) dollar amount fee, then listed where every dollar was being spent. X $ for Pest Control X $ for Lawn Maintenance X $ for Pool Care X $ for Management Fees Etc.

LynetteB
(Texas)

Posts:141

02/17/2010 8:42 AM
Here is a statement we have: Assessments are important to the financial ability of the Association to maintain common areas, and to pay for other necessary operations of the Association, all of which helps maintain property values and the quality of the community. I found this looking up how to sell a dues increase, but you could possibly use the info to word something that would work for your purpose. Look up this stuff as your state probably has it's own requirements. I found some of this on the CAN website which has a link on the left: 1.Too many delinquent dues could effect your ability to obtain certain types of insurance or at least will make the cost of it more expensive. 2. Some State laws requires associations to adequately budget so as to avoid special assessments unless waived in writing by a majority of residents. One problem with "taking the waiver" is that the association is then declaring that they are underfunded leading to at least three other issues: a. Banks are becoming more particular about loans in this climate. Not only are they more stringent on the buyer's credit, but they're becoming more stringent on associations as well. There are banks out there that will not underwrite a loan to a community that is underfunded because they fear that if a huge assessment comes due the buyer will walk sticking the bank with the bill. b. FHA has recently tightened their rules too and they are starting to ask for reserve information more than they used to. c. On the newest Ohio residential property disclosure form, sellers are required to disclose if they have reason to believe that a special assessment is possible. If an association is expressly underfunded, then an assessment is a possibility and must be disclosed to prospective buyers. That's going to turn buyers away. What happens if the seller doesn't disclose and an assessment hits a few years later that the reserve study warned about? Look out seller because the buyer might now have a cause for a civil suit against you. Those points are aimed squarely at the "I'm going to sell before an assessment hits" crowd. Hope this helps you come up with something.

MaureenM4
(Washington)

Posts:20

02/17/2010 12:48 PM
Paying assessments provides for association social activites which bring the community together. Paying assessments pays for your roads, street lights, and entrances (such as that nice signage you can see from the street). Pays for security personnel or gated access to your condo or home. Allows for prudent reserves which avoids the need for special assessment without the burden of getting a bank loan for imporvements. -Maureen

SheliaH
(Indiana)

Posts:350

02/18/2010 12:10 PM
You prevent your credit rating from taking a huge hit when the association has to file liens on your property, file a lawsuit against you and garnish your wages. You also prevent three months of non-payment of perhaps a few hundred dollars from erupting into a bill of several thousand dollars - which will now include late fees and legal fees the Association incurs to - file liens on your property, file a lawsuit against you and garnish your wages You help avoid special assessments which can be several thousands of dollars a pop and must be paid in addition to monthly, annual or quarterly fees.

MichaelK11
(Texas)

Posts:431

02/19/2010 7:14 AM
Are you speaking of Annual Assessments (dues) or penalty assessments (fines)? Either way, when a Member's assessments are paid current, then they can vote (and their vote will be counted) in HOA elections and other matters.

JanM7
(Missouri)

Posts:6

06/23/2010 8:59 AM
In regards to reasons to pay assessments. I would also research county/state statutes in regards to homeowner association fees and membership in a HOA. In our area, the city/county have statutes requiring our subdivision to have street lights and pay for them. They require us to have storm water detention ponds and maintain them. If the By Laws/Indentures have been recorded with the county, the residents are bound by law to be a memeber and follow the rules ( including fees if they are in the By Laws/ Indentures. Our By Laws require maintenance of signs and common areas as well as having liability insurance. Unfortunately, the county/city do not assist in enforcing a HOA By Laws. But you can cite that they exist. If the city/county must step in to assist with maintenace, the costs will be owed by individual residents and could become quite expensive.

BrianB
(California)

Posts:2381

06/23/2010 4:48 PM
I know it's outdated and old fashioned... You pay assessments because you agreed to, by law, and signed a contract to that effect, without anyone holding a gun to your head. To do less (unless the other side violated their side of the contract) would make you a cheat, welch, liar and morally impaired person, a horrible role model for today's youth. You would be some of that which is wrong with America today.

BonnieE
(Illinois)

Posts:331

07/16/2010 11:10 AM
Hi Rick, Did you complete your "top 10 reasons..."? I would be interested in seeing it. BTW, (I am also in IL) - I was looking at my HOA's property mgmt. website, reading the summer newsletter. I am guessing we may have the same PM company - by any chance are you the Rick W.... mentioned in the article on pg. 8? If you are, congrats on a job very well done! And, I would be interested in following up with you regarding our shared PM company as my BOD is having some issues (maybe to the extent of changing), and am interested in your thoughts about the PM company. Thanks, Bonnie

RickW
(Illinois)

Posts:160

07/17/2010 5:48 AM
Posted By BonnieE on 07/16/2010 11:10 AM Hi Rick, Did you complete your "top 10 reasons..."? I would be interested in seeing it. BTW, (I am also in IL) - I was looking at my HOA's property mgmt. website, reading the summer newsletter. I am guessing we may have the same PM company - by any chance are you the Rick W.... mentioned in the article on pg. 8? If you are, congrats on a job very well done! And, I would be interested in following up with you regarding our shared PM company as my BOD is having some issues (maybe to the extent of changing), and am interested in your thoughts about the PM company. Thanks, Bonnie Hi Bonnie, I never really came up with a top 10 list...I did post the following in our newsletter.. Reasons To Pay Monthly Assessments Did you know that approximately two thirds of your monthly assessment funds the operating and maintenance costs of our association? Without everyone's payments we could not maintain and improve the value of our complex. Did you know that the streets of our association are owned and maintained by the association? Your monthly assessment contributes to the upkeep of our streets and also contributes to the reserve account to fund repair and replacement of the streets and curbs. Did you know your assessments pay for the painting of our buildings? One half of our complex was painted last summer/fall and the other half will be painted in the spring of 2010. Did you know that banks are now looking at the association financials prior to approving mortgages? Banks now want to be assured that associations are not only budgeting for capital expenditures, but also check to see how many delinquencies there are in the association. This can affect the value of our homes. Did you know your assessments pay for the landscape maintenance and beautifucation of our complex? This include the common areas as well as the landscaping immediately adjacent to your unit. Did you know your assessments helps to pay for the maintenance of our ponds? The board of directors is working on establishing an ongoing program for the ponds to beautify the shoreline with prairie type plants and flowers. You're right, we do have the same property management company and thanks for the compliment I'd be more than happy to talk with you regarding management companies... rick.wetzel@westfieldsquare.com Rick

MaryA1

Posts:0

07/17/2010 9:14 AM
Rick, Good info! You stated: "Did you know that banks are now looking at the association financials prior to approving mortgages? Banks now want to be assured that associations are not only budgeting for capital expenditures, but also check to see how many delinquencies there are in the association. This can affect the value of our homes." As a matter of clarification. . . That may only apply to FHA mortgages for condos. The FHA has come out with requirements a condo must meet to qualify for FHA financing. As far as I know these requirements do not apply to single family homes. Also, I don't know that there are any such qualifications to meet for conventional mortgages. However I have heard that people with even the best credit ratings are being denied a mortgage or other financing. That's bad enough without having the HOA resp. for your mortgage being denied!

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