Condo and HOA Collections …Can We Sound The All Clear?

With the economic recovery in full blossom it would seem that community associations including, Condo and hoa collections are out of the woods and happy days are here again. Sorry, but no. You may see new projects popping up all over and prices on the rise but if your association was established before 2013 chances are you are still plagued with delinquent owners, saddled with doubtful debt and are low on reserves. In other words your association lacks the financial vitality it should have in order for it to be a worthwhile investment. Curb appeal and amenities aside buyers are now more cautious and considering how financially robust the association is before they make their purchases. There is still a lot of work to be done for many associations.

This is a problem that has not gone away and will continue to linger, but because many boards of directors have become so accustomed to having delinquencies and doubtful debt on the books they may believe that the storm has passed and it is safe to go back in the water. The truth of the matter is that no amount of delinquencies are acceptable in a “zero dollar business” (community associations are not for profit entities) and there is still a lot of debt on those books that need collecting. The banks are far from completing all of their foreclosures.

Your association, now more than ever, must make a push to collect Condo and Hoa Collections as to what is owed, to bring the community back to health. Buyers are not just looking at the square footage and view but are also considering the financial stability of an association when they are making their purchasing decisions. Would you buy into a community association where a special assessment was inevitable? Is your association FHA compliant?

If nothing else community associations should be coming out of this crisis (2006-2015) with a better understanding of what the dynamics are and how to manage delinquencies. What did not kill you should have made you stronger and smarter. Some lessons learned are that hoa collections delayed are collections denied, that there are many options an association has in order to effectuate a successful collection, there are many types of professionals who can make that happen and most important delinquencies no matter how few or how small are not acceptable. The crisis may seem to be over but nobody should be landing on an aircraft carrier and claiming “mission accomplished.”