Although our expertise is in community association collections our Senior Management Team are experts in money management, and after all when we recover association funds there are things you should know.  So here are some commonly asked questions and answers that we get from boards of directors regarding reserves:

1) What types of bank accounts are operating funds and reserve funds held in, respectively?

Answer:  Association funds should be held in financially stable, federally or state chartered banks and/or savings and loans that provide government guarantee on deposits.  As importantly, they should NOT be comingled and transferring money from the reserve account to the association’s operating account should not be a simply task to be accomplished by just one board member.  Therefore, the financial institution the association utilizes should have appropriate control procedures available to the association to make sure at minimum two active board members are involved with any transfers out OR between their bank accounts.

The classic definition of a Zombie Debt simply put “the undead.”  That is to say a person is dead but still has some features of being alive so in essence they are not “totally dead.”   It sounds creepy, and it is creepy but in almost every community association in these United States there lurks “Zombie Debt.”  Zombie Debt is best described as money an association has written off because a bank has foreclosed and there were dues owing that the association never received.  The mistake is that this debt is not dead and much like a Zombie it still lives and can be collected.  So why have not boards of directors and management companies not attempted to collect this Zombie Debt?

Learn from SNAP Collections how your community association can engage the Latest, Newest, and most innovative collection program.

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