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9 Advantages Of Hiring HOA Security

Security is a primary concern for many homeowners associations. But, is hiring HOA security guards or companies even worth the investment?

 

Top Reasons to Hire HOA Security Guards

One of the chief considerations many homebuyers make before purchasing a home is security, especially if the home is located within a community association or subdivision. Even after the homebuying process, though, security remains important. The residents of an HOA community deserve to feel safe in their own neighborhoods. And, when security starts to lax, residents will surely bring the issue to the HOA board.

If an HOA wishes to beef up its security, hiring a security company or security guards is a good place to start. Here are the benefits of employing HOA security guards.

 

1. Maintain Exclusivity

Gated communities manage to preserve property values and maintain appeal through exclusivity. But, it is also a way of protecting the people who live within the community. By screening visitors and keeping non-residents out, the community can remain exclusive.

Even if a community isn’t gated, though, security guards remain a useful investment. Homeowners associations typically have common areas and amenities that are only available to members. Associations can post security guards outside of these areas, and they can screen people who enter the facilities. They can disallow entrance to outsiders and keep residents safe.

 

2. Deter Crime

homeowners association securityDid you know that more than 1 million home burglaries happen in the United States every year? With break-ins and theft such a big problem for homeowners, security guards are well worth the money.

When you post security guards at entrances and exits, you can help deter crime in the community. This includes break-ins, theft, and even vandalism. A lower crime rate within the neighborhood can help boost property values and keep residents feeling safe. If crime is a big issue for your HOA, hiring security guards or a security firm can improve homeowners association security.

 

3. Minimize Parking Violations

Parking and traffic violations are not always easy to spot. This is because these rule violations require a keen eye and actual time spent outside. In that sense, security guards are perfect for the job. One of the HOA security responsibilities they can perform is to look out for any traffic or parking rule violations. The offender may not feel too good about receiving a notice of violation or being slapped with a fine. But, it will help your HOA board consistently enforce the rules and minimize future violations.

 

4. Liaise With Law Enforcement

It is imperative for every homeowners association to maintain a healthy relationship with local law enforcement. After all, not all problems can be resolved in-house. There are some things, such as crime reports and issues of domestic violence, that require police intervention.

HOA security companies can act as the first responder. When a security guard receives a crime report, they can refer the issue to the local police department. Essentially, security guards can act as the liaison between the homeowners association and the law enforcement agency.

 

5. Patrol

hoa security guardsSecurity guards are not omnipresent beings. They are usually posted to a specific area and given responsibilities to fulfill. But, when you hire a security company, they can also supply guards who can conduct regular patrols. Foot and vehicle patrols are great because they can help identify crime and rule violations as they occur. An HOA security patrol also works to ensure the community remains a safe place to live in, as residents tend to feel more secure when there are trained professionals watching over the neighborhood.

 

6. Assist Guests

Gated HOA communities are only usually open to members of the association. But, it is not uncommon for residents to receive guests and visitors, especially during the holiday season when parties occur more frequently.

When guests visit the HOA community, security guards can meet them at the gate. Guards can provide them with a gate pass that will grant them entry into the community. They can also educate guests on where they can park and offer directions to their destination. Additionally, guards can keep a physical record of guests’ names, making it easier to use as a reference in case the need arises.

 

7. Monitor Security Cameras

It is normal for an HOA to install security cameras in common areas. But, depending on the make and model, these security cameras aren’t always advanced enough to alert board members when an altercation is happening in real-time. For full effect, your HOA security will still need a human touch. This is where security guards come in.

Security guards can monitor surveillance cameras while on duty. They can spot crime and other unwanted activity from afar and then either respond to it or pass it on to management. Just make sure the security cameras in your HOA community don’t infringe on privacy laws.

 

8. Round-the-Clock Safety

hoa securityThe great thing about hiring security guards is that you can post them 24/7. Security firms offer different packages, with shifting schedules allowing for round-the-clock safety and patrolling. While it is true that people tend to feel more uncomfortable under the cloak of darkness, there are plenty of things that can happen in the daytime, too. In fact, almost half a million home burglaries occur during the day because thieves think people aren’t at home during this time.

 

9. Professional Training

Although an HOA can theoretically rely on volunteers to conduct neighborhood watches, volunteers are far from experts. Security guards are trained and licensed professionals. They know exactly what to do and how to respond when faced with different scenarios. Residents are also more likely to listen to security guards than their neighbors.

 

Taking the Right Steps

Many homeowners associations struggle with improving HOA security in their communities. But, by hiring security guards and installing security cameras, HOAs can take one step closer to ensuring the safety of residents.

Managing a homeowners association poses several challenges, whether for HOA boards or for HOA management companies. Simplify your life with the help of management software from Condo Manager. Call us today at (800) 626-1267 or contact us online for a free demo of our product.

 

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9 Of The Most Important Duties Of An HOA Property Manager

An HOA property manager fulfills several important responsibilities that are essential to the smooth operation of a community. Whether you’re thinking of hiring a manager or becoming one, make sure to familiarize yourself with these duties ahead of time.

 

The Importance of an HOA Property Manager

Managing a homeowners association, especially larger ones, can come as a huge challenge. While there is an HOA board responsible for this undertaking, board members face difficulties all the time. They have personal and professional lives to juggle, which means time is usually a luxury. Board members also don’t always have the right skills needed for the job. After all, they are just volunteers.

This is where an HOA property manager comes in. Also known as a community association manager or a condo association manager, an HOA property manager essentially shoulders most of the board’s burden. But, rather than acting autonomously, the HOA manager works with the board to manage the community. It is worth noting, though, that the HOA manager is not a part of the board.

 

The Duties and Responsibilities of an HOA Property Manager

A homeowners association manager performs many tasks that keep the community in good condition. These include common area maintenance, invoicing and collections, homeowner and board communication, rule enforcement, vendor management, financial management and reporting, board education and assistance, risk management, and administrative duties. Let’s break each of these down below.

 

1. Common Area Maintenance

HOA property managers must make sure all common areas and amenities remain clean and well-maintained. This often means conducting site inspections, fielding maintenance requests, and hiring vendors when necessary. Safety is also a top priority, as a lot of things can happen to residents while using common areas. Any injuries that occur on-site could hold the association liable.

Additionally, preventive maintenance is paramount and always trumps corrective maintenance. By following a preventive maintenance schedule, managers can keep structures and equipment functional for a longer period of time. It also avoids breakdowns, which can cost the association a lot of money to repair. If there are any special projects underway, the manager also holds the responsibility of carrying out the contracts, ensuring the project remains on schedule, and making sure the HOA stays on budget.

 

2. Invoicing and Collections

Homeowners associations collect regular fees from homeowners as a way to fund their expenses. The HOA property manager carries the burden of sending out invoices to homeowners ahead of time and making collection efforts. This includes any collections done online and offline. The manager should also track and manage delinquencies to keep the association and its members in good standing. This could mean imposing late fees, offering payment plans, placing a lien, and initiating foreclosure proceedings.

 

3. Homeowner and Board Communication

community association managerCommunication plays a significant role in the success of an HOA community. The HOA manager is responsible for keeping an open line of communication, whether with residents or the HOA board.

This includes sending out notices on time, facilitating the creation and distribution of newsletters, and making sure residents gain easy access to relevant information. It also means manning phone lines and email inboxes for any concerns coming from homeowners. Though, it is often better to have a website or management software that allows for a more streamlined method of communication.

 

4. Rule Enforcement

Every HOA manager should have a good grasp of the association’s bylaws and CC&Rs. This will allow them to enforce the rules more consistently and thoroughly. Part of the job description is to perform frequent inspections for any violations, send violation notices, and organize disciplinary hearings. Keep in mind, though, that the manager does not have the final say on these matters. Managers still have to defer to the board’s decision and implement it accordingly.

Additionally, an HOA property manager should have more than just a working knowledge of the law. That doesn’t mean they should be lawyers. But, a deep understanding of the federal and state laws that apply to HOAs is critical in ensuring the association keeps out of legal trouble. Some examples of federal laws that apply to HOAs include the Fair Housing Act and the Freedom to Display the American Flag Act.

 

5. Vendor Management

Homeowners associations don’t work alone. Oftentimes, it is necessary to employ outside help to carry out different functions. For instance, an HOA would need to hire a contractor to perform repairs or a landscaper for landscaping. The manager would be responsible for preparing requests for proposals (RFPs), helping the board choose a vendor, coordinating with existing vendors, and ensuring vendors do a good job.

 

6. Financial Management and Reporting

For many homeowners associations, financial management is the most difficult aspect of HOA management. But, an HOA manager can help with this, too. The manager would be in charge of accounting and bookkeeping. They would also prepare the monthly financial statements for the board’s review. Managers can also help the board plan and stay on budget.

Reserve studies, though, are often outside of an HOA property manager’s expertise. For that, the manager would need to hire a professional but still possess an understanding of the study itself. Other than that, an HOA manager can assist the board with tax filing.

 

7. Board Education and Assistance

Board members don’t always come equipped with the skills and knowledge required for successful community management. Fortunately, an HOA manager can help the board understand and implement the best practices. They can also help assess the current policies of the community and recommend any changes. After all, some boards just create policies on a whim without considering whether or not they comply with the law and the association’s governing documents. Several management companies also offer board education and training programs.

 

condo association manager8. Risk Management

Homeowners associations assume a lot of risks, too. It is the job of the HOA manager to help mitigate these risks through careful evaluation and planning. By determining the possible risks, an HOA manager can help the board prepare for the worst-case scenario. This also means ensuring the association has the right insurance policies in place.

 

9. Administrative Duties

Aside from those listed above, there are several other tasks that managers have to fulfill that are more administrative in nature. These include planning and attending board meetings, contract reviews, answering homeowner concerns, emergency after-hours services, organizing events, and maintaining the community website.

 

The Best Choice You Can Make for Your Community

Many homeowners associations struggle with community management on a daily basis. While self-management is certainly an option, it is often best to outsource the job to an HOA property manager.

Condo Manager is the best HOA management software provider you can find. Whether you’re a self-managed HOA or an HOA management company, we have a solution for you. Call us today at 800-626-1267 or contact us online for a free demo.

 

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Memorial Day VS Veterans Day: What’s The Difference?

Memorial Day vs Veterans Day — while they may seem similar, there are key distinctions between these two military-centric federal holidays. But, what exactly is Memorial Day? And how does it differ from Veterans Day?

 

Memorial Day vs Veterans Day: Understanding the Differences

Every year, Americans celebrate two federal holidays that honor those who served in the United States armed forces. To this day, though, many people still confuse these holidays with one another. Memorial Day and Veterans Day share some similarities, but they are not one and the same. What is the difference between Memorial Day and Veterans Day? Let’s break them down below.

 

What Is Memorial Day?

Memorial Day honors military personnel who died while in the service of the United States armed forces. This federal holiday takes place every year, on the last Monday of May.

Originally named Declaration Day, Memorial Day first started as a way to commemorate the fallen soldiers of the American Civil War. The day eventually evolved into a day of general commemoration of fallen soldiers in all wars, being declared a federal holiday in 1971. Interestingly, the country initially celebrated Memorial Day every 30th of May before changing its date to the current last Monday of May.

 

What Is Veterans Day?

veterans day vs memorial dayVeterans Day honors all those who have served in the United States armed forces. Unlike Memorial Day, Veterans Day celebrates all veterans, not just those who died in the wars. This federal holiday takes place every year, on November 11, the day World War I ended.

Originally named Armistice Day, Congress officially recognized it as a federal holiday in 1938. Then, in 1954, Armistice Day was changed to Veterans Day and no longer just honored those who served during World War I. Veterans Day now covers all men and women who served in the United States armed forces. Many countries in Europe also place significance on November 11, though, in those countries, the day retains its original name of Armistice Day.

 

Veterans Day vs Memorial Day: How to Celebrate

Apart from who these holidays honor, there are also key differences when it comes to the manner of commemoration. Here are the distinctions between how to celebrate Memorial vs Veterans Day.

 

How to Celebrate Memorial Day

Memorial Day is all about honoring all military personnel who died while serving in one of the branches of the United States armed forces. Therefore, as a way to commemorate this federal holiday, many Americans visit national cemeteries and monuments in remembrance of the fallen. It is also customary to place a flag on the graves of fallen soldiers as well as attend a memorial service.

Americans are also encouraged to take a pause at 3 p.m. during the National Moment of Remembrance on Memorial Day. Other ways to participate in the holiday include displaying the United States flag outside your home in a manner consistent with the U.S. Flag Code, watching a National Memorial Day Concert, and participating in a run or walk that benefits relevant non-profit organizations.

 

How to Celebrate Veterans Day

Veterans Day is the perfect time to reach out to known veterans and thank them for their service. During this holiday, people post photos on social media with a respectful caption and tag veteran family and friends. It is also common for people to reach out to a veteran and talk to them about their time in the military. Doing so will give Americans a better understanding of their service and gain a deeper appreciation for their contributions.

There are also many cities that hold Veterans Day events such as parades. Participating in those events can be a great way to show support. Some churches also schedule special services on this day. Like Memorial Day, people can celebrate Veterans Day by displaying the U.S. flag and helping a non-profit.

 

Memorial Day vs Veterans Day vs Armed Forces Day

Armed Forces Day is another holiday that Americans associate with the military. And while it might also share a few similarities with Memorial Day, Armed Forces Day celebrates something different.

 

What Is Armed Forces Day?

memorial vs veterans dayArmed Forces Day honors all men and women who are currently serving in one of the branches of the United States armed forces. It takes place every year, on the third Saturday of May. Memorial Day and Veterans Day are both federal holidays. Armed Forces Day, though, is not. But, like Memorial Day and Veterans Day, Americans can celebrate Armed Forces Day by displaying the U.S. flag.

 

Military Appreciation Month

May is brimming with holidays that commemorate the United States military. As such, it is known as Military Appreciation Month. Apart from Memorial Day, which takes place on the last month of May, and Armed Forces Day, which takes place on the third Saturday of May, here are other important dates during Military Appreciation Month:

  • Loyalty Day (May 1). A day when Americans re-assert their loyalty to the United States.
  • Public Services Recognition Week (First Full Week of May). This week recognizes the men and women serving as federal, state, and local government workers.
  • Victory in Europe Day (May 8). This commemorates the surrender of Germany in World War II.
  • Military Spouse Day (Friday Before Mother’s Day). A day to remember the sacrifice and support of the spouses of military personnel.

 

Memorial Day vs Veterans Day: Differences Answered!

Both Memorial Day and Veterans Day commemorate military personnel who served in the United States armed forces. But, whereas Veterans Day honors all those who have served in the military, Memorial Day specifically honors those who died while in service. Either way, both federal holidays fulfill significant purposes.

 

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HOA Debt Collection: Is The HOA Taking Advantage?

Consumers are protected by certain laws when it comes to debt collection. Chief among them is the federal Fair Debt Collection Practices Act. But, does this law apply to homeowners associations, too?

 

Fair Debt Collection Practices Act Definition

The Fair Debt Collection Practices Act (FDCPA) is a federal law governing the collection of debt. The law was passed by Congress in 1977 and aims to prevent deceptive, abusive, and unfair debt collection practices. According to the Act, debt collectors are not allowed to harass consumers or employ deceptive tactics when attempting to collect on their debts. In addition to what debt collectors can’t do, the Act also defines what debt collectors must do when attempting to collect a debt.

Are HOA Collections Governed by the FDCPA?

Homeowners living in HOA communities have an obligation to pay monthly dues to their association. The HOA then uses these dues to fund the many expenses required to keep the community in operation. These expenses can include but are not limited to maintenance costs, insurance premiums, and management fees.

Like any payer-payee relationship, though, HOAs are not immune to delinquencies. It is not uncommon for homeowners to default on their monthly fees. Usually, these delinquencies result in late fees, the suspension of privileges, and even lawsuits. In some cases, HOAs will also attach a lien to the delinquent owner’s property and even initiate foreclosure proceedings. Associations do all of this in an effort to collect the debt delinquent homeowners owe.

Sometimes, though, an association will also transfer the bad account to a third-party agency as part of its HOA debt collection policy. This is where the FDCPA comes into play.

In general, the FDCPA does not recognize homeowners associations as debt collectors. As such, the Act does not typically apply to them. The FDCPA only applies to debt collectors, i.e. any entity or individual whose primary business is to collect debt on behalf of third parties. So, while the FDCPA may not apply to HOAs, it does apply to the collectors HOAs employ. Many courts have also ruled that the FDCPA can apply to attorneys if it collects debts or unpaid dues on the association’s behalf.

 

Communication Standards for HOA Collection by Third Parties

According to the FDCPA, debt collectors must use any communication that even the “least sophisticated consumer” can understand. This standard is in place so that debt collectors don’t use fancy or complex language in an attempt to confuse or deceive the consumer. It offers protection to even the least experienced individuals. Additionally, using simple language also eliminates vague terms, which can lead to misunderstandings.

Adhering to this standard, the FDCPA requires debt collectors to provide the following communication to a consumer, either in oral or written form: “This communication is from a debt collector in an attempt to collect a debt. Any information obtained will be used for that purpose.” Every succeeding communication should then include either “This communication is from a debt collector,” or “this is an attempt to collect a debt.”

Following the initial communication, the debt collector must then provide the following within five (5) days in written form:

  • Amount of debt owed;
  • Name of the creditor;
  • A statement saying that the consumer has 30 days to dispute the debt’s validity or else the debt will automatically be deemed valid by the collector;
  • A statement saying that, if the consumer disputes the debt’s validity within the timeframe, the debt collector must then secure verification of the delinquency or a copy of the judgment. The collector must then mail a copy of that document to the consumer; and,
  • A statement saying that the debt collector will provide the name and address of the original creditor if the consumer supplies a written request to do so within the 30-day period.

 

Prohibited Acts Under the FDCPA

In accordance with the FDCPA, banned acts include but are not limited to the following:

  • Talking about the debt with any party other than the consumer
  • Calling the consumer before 8 a.m. or after 9 p.m.
  • hoa collectionsTalking to the consumer when an attorney already represents them
  • Any acts of harassment or abuse, such as:
    • Threatening the consumer with violence or other illicit acts
    • Using profane or obscene language
    • Making incessant calls
  • Making false or misleading statements, such as:
    • Falsely introducing themselves as an attorney
    • Implying or stating outright that the consumer will face criminal charges upon failure to settle the debt
    • Threatening the consumer with consequences that the debt collector can’t legally do
  • Attempting to collect an unauthorized amount

 

Who Handles Fair Debt Collection Practices Act Violations?

Debt collectors have been known to abuse their position and employ illegal tactics. Consumers who don’t know the law well enough will sometimes fall prey to these unfair practices. If a consumer or homeowner believes they are a victim of FDCPA violations, they can file a complaint with one of the following agencies:

  • Federal Trade Commission. The FTC is the main agency inc charge of enforcing the Fair Debt Collection Practices Act.
  • Consumer Financial Protection Bureau. One of the CFPB’s many responsibilities is enforcing the FDCPA.
  • State Attorney General’s Office. For state-level complaints, consumers can reach out to their State Attorney General’s Office. Go to their website for more information.

As per the FDCPA, consumers can file a federal claim for actual damages as well as additional damages up to $1,000. The claim can also include coverage for attorney’s fees and other reasonable costs.

 

Are HOA Management Companies Debt Collectors?

While all courts recognize HOA dues as consumer debt, there is some debate as to whether or not HOA management companies count as debt collectors. There is no universal answer to this, as situations should be evaluated on a case-by-case basis. That said, it really comes down to the primary purpose of the management company.

If an HOA management company’s primary services consist of collecting unpaid fees, then courts may deem it a debt collector. In that case, the FDCPA does apply to the management company and its practices. In contrast, if a management company’s primary focus is maintaining common areas, it might not fall under the FDCPA or what counts as a debt collector.

 

Something to Think About

The Fair Debt Collection Practices Act exists to prevent debt collectors from using unfair, deceptive, and abusive tactics when attempting to collect a debt. At face value, the FDCPA may not seem like something HOAs should worry about. But, considering the legal implications of associating with a non-compliant third-party collector, HOAs would do well to carefully select a collection agency.

Don’t want to outsource your collection efforts? Condo Manager makes dues collection and delinquency tracking easier with automated processes. Call us today at (800) 626-1267 or contact us online for a free demo.

 

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HOA Master Insurance Policy: How Does It Protect An HOA?

One thing that every homeowners association should have is comprehensive insurance coverage. Insurance, of course, comes in several forms, though one of the most important is an HOA master insurance policy.

 

Understanding an HOA Master Insurance Policy

A homeowners association master policy, often referred to as simply HOA insurance, is a form of insurance designed to protect HOAs. Standard master insurance policies typically cover two things:

  • Property damage to any structures or shared spaces that the HOA owns; and,
  • Liability expenses that the HOA is responsible for, including if a guest becomes injured in a common area.

This type of policy differs from homeowners insurance in that it covers things owned by the association itself. Individual homeowners or condo owners will generally still need to purchase their own insurance to cover their personal residence and belongings.

An HOA master policy is essential to homeowners associations because it offers financial protection. For instance, if a guest slips and gets injured on HOA property, insurance can cover the cost of the guest’s medical expenses. If that guest decides to sue the association, the HOA will not need to tap into its own funds. Instead, the master policy can pay for the cost of legal fees and attorney’s fees as well as any monetary damages the HOA is ordered to pay (if any).

Similarly, if an HOA building becomes damaged due to a covered peril, a master policy can cover the cost of repairs or replacement. This means HOAs won’t have to use their own funds or levy special assessments to pay for the expenses.

 

Types of HOA Master Insurance Policy

There are three kinds of HOA master policies: bare walls in coverage, single entity coverage, and all-in coverage. Let’s break them down further below.

 

1. Bare Walls in Coverage

As its name suggests, a Bare Walls in Coverage policy provides bare minimum protections. This policy usually only covers the structure of the building, specifically the drywall, insulation, and studs.

 

2. Single Entity Coverage

A Single Entity Coverage policy includes the same protections as a Bare Walls in Coverage policy but with additional protection for the interior structure. It can also extend to the outside of the walls, top flooring, bathroom fixtures, and cabinets. Other names for this type of master policy include walls in coverage and studs in coverage.

 

3. All-In Coverage

The third type of master policy, the All-In Coverage policy, is the most comprehensive. It offers the same protections as the single entity coverage policy but takes things up a notch by covering built-in appliances as well. An all-in coverage policy can also cover unit improvements and modifications.

 

Who Pays for HOA Insurance?

master insurance policy for homeowners associationWhile the homeowners association technically pays for HOA insurance, the funds really come from the owners. Homeowners have an obligation to pay regular dues or fees to the association as determined by the annual budget. This budget includes projections for insurance premiums, including premiums for the HOA master insurance policy. Because homeowners share the use of common areas, it makes sense for homeowners to share the expenses needed to maintain these areas as well.

 

How to Get HOA Master Insurance Policy

Taking out a master insurance policy may seem easy on paper, but there are a few things that go into it that not many people know. Whether you’re on the board of your HOA or are involved in HOA management in any way, here are the steps for getting a master insurance policy for homeowners associations.

 

1. Determine Needs and Budget

First of all, it is important to assess the needs of the association. What type of coverage is the HOA looking for? Obviously, a more comprehensive policy will cost more, but it does offer better protection. Conversely, some board members or managers might feel tempted to save a buck and go for the cheapest option. This will not bode well for the HOA, though, once a risk occurs and it is not covered by the association’s insurance.

 

2. Scope Out the Market

Once you have determined your needs and set a budget, it is time to examine your options. Don’t be afraid to shop around for a good deal. You can search online for the best insurance providers or ask around for recommendations. Again, cheap does not always mean good, and an insurance provider’s low prices can very well reflect the quality of their service.

 

3. Ask for a Quotation

Reach out to your list of prospects and ask them to provide you with a quotation. Make sure to let them know what type of coverage you want for the HOA, the target coverage limit, and your budget. Providers will be able to come up with a proposal with these details in mind. But, make sure to standardize your request for a proposal so that you can compare apples to apples.

 

4. Check Reviews and References

Cost is not the only thing you should take into account when searching for an insurance provider. Some may offer great deals but fail miserably when it comes to customer service. Be sure to do some research and check the company’s reviews. If they have any references to give you, contact them as well. Ask about the provider’s claims process and if clients had any negative experience whatsoever.

 

5. Evaluate Yearly

Insurance is not something you can just set and leave behind. As an HOA community grows and evolves, its insurance needs may change. And you don’t want to be stuck with inadequate coverage. Therefore, make sure to review your insurance needs and policies every year. The process should include re-evaluating your needs as well as your insurance provider. If your provider has not performed well, don’t hesitate to make a switch.

 

What Other HOA Insurance Policy Should You Get?

Besides an HOA master insurance policy, there are other types of coverage all homeowners associations should have.

  • how to get hoa master insurance policyProperty Value and Replacement. Buildings that belong to the HOA must be insured for the property’s full replacement cost. There are three building ordinance coverages: contingent liability (coverage A), demolition (coverage B), and cost of construction (coverage C).
  • D&O Insurance. Another essential form of HOA insurance coverage is D&O insurance. This applies to directors and officers and provides coverage for indemnity, defense costs, liability claims, and errors.
  • Workers’ Comp. Whether your HOA employs workers or not, workers’ comp is vital. It can cover the employees of vendors and contractors as well as volunteers in the event they are injured on the job.
  • Crime and Fidelity. This type of insurance protects the actual money in the association’s operating and reserve accounts. It covers check fraud, false invoices, embezzling, wire fraud, and computer fraud.

 

A Lesson to Be Learned

Insurance is something that no homeowners association should ever go without. One of the most important types is an HOA master insurance policy, which offers coverage for property damage and liability expenses. If an HOA does not have proper or sufficient coverage, it will, without a doubt, eventually find itself in financial trouble.

Tracking your insurance policies can be hard, especially if you’re doing it manually. Automate your process and know when your insurance has expired with the help of Condo Manager. Call us today at 800-626-1267 or contact us online for a free demo.

 

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What Is An HOA Fee? What Are Homeowners Paying For?

Living in a homeowners association comes with benefits, but it also comes with financial obligations. Here, we discuss what is an HOA fee and everything else you need to know about it.

 

What Is an HOA Fee?

Potential homeowners have to do a lot of research before they buy a home. When that home is located within a homeowners association, there is twice as much research to do. You need to check that the association is in good financial condition, review its governing documents, and familiarize yourself with what your obligations will be once you become a member. After all, membership is normally automatic in HOAs once you buy the home.

One of the financial obligations you have to fulfill is paying HOA fees. What are HOA fees? Otherwise known as HOA dues, these are the fees that HOAs collect from homeowners on a regular basis. The fees are used to pay for the various expenses associated with the maintenance and upkeep of the community. Fees are collected monthly, quarterly, and annually, depending on the association’s rules.

While HOA fees can vary greatly from one association to another, they average about $200 to $300 per month in the United States. Keep in mind, though, that several factors can influence these fees. These include the size of the association, the extent of its common amenities, and the location of the association. More affluent communities with a wider range of amenities can even charge as high as $1,000 per month.

 

HOA Fees vs HOA Assessments

Many people use the terms “HOA fee” and “HOA assessments” interchangeably. But, there is actually a clear distinction between the two. An HOA fee refers to the regular dues that homeowners pay, whereas an HOA assessment usually refers to a special assessment. A special assessment is something that the association levies in addition to regular dues or fees.

Typically, the need to collect special assessments comes up for one or more of the following reasons:

  • Failure to come up with an accurate budget
  • Failure to budget the funds appropriately, resulting in a budget deficit
  • Insufficient funds in the reserve account
  • Unanticipated costs such as damages after a natural disaster

 

What Do HOA Fees Cover?

Throughout the course of its operation, a homeowners association will naturally incur expenses. After all, even with a functioning board, an HOA can’t do most of the work itself. Here are the expenses the HOA fees cover:

  • Maintenance and Repairs. These can include the cost of goods and materials as well as the cost of professional services such as cleaning, snow removal, plumbing, electrical wiring, pool maintenance, HVAC costs, inspections, pest control, and the like.
  • what are hoa feesInsurance Premiums. Homeowners associations have to maintain a number of insurance policies, including but not limited to a master policy, a D&O policy, crime insurance, and workers’ comp.
  • Management Fees. An HOA management company can make the board’s job infinitely easier. But, such services come with a price in the form of management fees.
  • Utilities. Common areas also use essential utilities such as electricity and water. The cost of these utilities is typically shouldered by the homeowners association, which collects the funds from homeowners in the form of HOA fees.
  • Landscaping Costs. While this generally falls under maintenance costs, landscaping deserves a spot of its own since it is one of the most common expenses an HOA will incur. Curb appeal is a top priority among most associations, the prevalence of landscaping does not come as a surprise.
  • Reserves. Every homeowners association has to maintain a reserve account which consists of monies set aside for major repairs and replacements in the future. Each homeowner contributes to this reserve fund by way of HOA fees as well.

 

Who Determines HOA Fees?

The HOA board is responsible for the operations of the association, and this includes setting the HOA fee amount each year. To calculate dues, the board first has to come up with an operating budget. This budget should include all the anticipated costs for the coming year as well as any reserve contributions. It is also a good idea to establish a contingency fund for unexpected costs that crop up throughout the year.

After totaling the anticipated expenses, the board then divides the amount among all the homeowners according to the formula listed in the association’s governing documents. Some communities divide it equally among all homeowners, whereas others divide it based on a percentage share.

 

The Consequences of Failing to Pay HOA Dues

Paying HOA dues is a financial obligation that every homeowner in the community is expected to fulfill. Naturally, there are penalties for failing to stay up-to-date on your dues. These penalties can range from monetary fines to foreclosures.

 

1. Late Fees

The first thing most associations do, after sending a notice, is to charge a late fee. This late fee can be a percentage of the amount due or a fixed amount. Late fees can also accumulate interest as time goes by, resulting in a much higher outstanding debt the longer you don’t pay.

 

2. Suspension of Privileges

Homeowners have access to certain privileges when living in an HOA community. But, when you stop paying your dues, these privileges can be revoked temporarily. You may no longer have access to common amenities such as pools, gyms, and clubhouses. It’s also worth noting that most associations don’t allow you to run for a position on the board if you’re not in good standing.

 

3. Small Claims Court

Homeowners associations can also take legal action against those who don’t pay their dues. This may end up in small claims court, and the HOA may receive the ability to seek compensation through your paycheck or bank account.

 

4. Liens

When a homeowner defaults on their fees, an HOA generally has the right to attach a lien to the property. This will make it significantly harder for the homeowner to sell their property, as they will need to settle the lien first. Liens also make it difficult to secure another mortgage.

 

5. Foreclosure

Homeowners associations are not afraid to foreclose. Once a lien has been placed on the property, HOAs can then initiate foreclosure proceedings. There are two types of foreclosure: judicial foreclosure and non-judicial foreclosure. Judicial foreclosure involves the HOA filing a lawsuit against you and getting permission from a court to sell the home. On the other hand, non-judicial foreclosure only requires the HOA to follow certain statutory steps.

 

HOA Fees Too High? Limits on HOA Fees

hoa feesA homeowners association is bound by federal and state laws as well as its governing documents. In some states, an HOA can only increase its fees by a certain amount or percentage each year. For example, in Arizona, HOAs have to seek approval from the membership before charging dues that are 20% higher than the previous fiscal year.

Associations also have to follow the stipulations recorded in their bylaws and CC&Rs. For some associations, though, especially older ones, the provisions on fee limits have become outdated. For instance, if an HOA’s bylaws say it can only charge up to $80 per month, it will be hard for that association to meet its budgetary needs. In such a case, it is necessary to amend the governing documents.

 

What Is an HOA Fee? Answered!

Paying HOA dues is a normal part of living in a homeowners association. Homeowners have to understand that these fees serve a purpose — they keep the community beautiful and functional, thereby improving the quality of life for all of its residents. But, not everyone wants that kind of financial commitment. As such, before you buy a home in an HOA, consider all of the obligations that come with it.

Managing a homeowners association is often challenging, but HOA software can make it easier. Call Condo Manager today at (800) 626-1267 or contact us online for a free demo.

 

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5 Easter Community Outreach Ideas

Outreach programs are a great way to give back while bringing community members together at the same time. If you need some ideas for your Easter community outreach, you have come to the right place.

 

Want to Do Some Easter Community Outreach? Here are 5 Ways

This 2022, Easter falls on April 17. The holiday is of particular importance to Christians, as it commemorates the resurrection of Christ. Considering the significance of the day, homeowners associations everywhere should take it as an opportunity to spread love and give back to their community.

Here are the best HOA community Easter outreach programs you can organize.

 

1. Collect Cash Donations

There are plenty of people and organizations that would benefit from cash donations. Even the smallest amount of money can help feed the homeless or keep a family from losing a loved one. Cash donations are also easier for community members because all they need to do is give money or write a check.

To organize this, make sure to advertise the program. Let everyone know that the association will be collecting cash donations and that everyone is free to donate (or not donate) their money, no matter how much. Residents can either drop donations in a box or someone can go door-to-door to collect them. You can accept hard cash, checks, or have residents do an online transfer to a designated account.

The only caveat to a cash donation drive, though — and it is a pretty big one — is that there is a chance that the money might not go to the intended foundation or charity organization. The person handling the money may be tempted to skim a little off the top for their own benefit. A good way to combat this is to assign more than one person to oversee the funds. Any withdrawals should also be co-signed by two or three people to avoid theft.

 

2. Plan a Canned Food Drive

easter community outreach ideasWhile cash donations are certainly helpful, they are a bit impersonal. Plus, there is more room for fund mismanagement and theft when hard cash is involved. If you want to go for a classic Easter community outreach program, a food drive is a good choice.

To do this, make an announcement early on that the association is launching a food drive and that members are free to participate. Set a deadline for collections so that people know how long they have to donate. You should also plan out how you will collect the food — will it be door-to-door or are residents supposed to drop off their donations at a designated place?

When it comes to food drives, it is always best to go with canned food or pantry staples that have a long shelf life. This is to prevent any spoilage along the way.

 

3. Organize a Clothing Drive

Clothing drives are more popular in wintertime, but they can also make for a great outreach program for Easter. After all, people also need clothes for the spring and summer seasons.

To organize your own clothing drive, partner with a charity or foundation. You can even go to a local children’s hospital or homeless shelter. As with the food drive, make sure to give the announcement well in advance. This way, residents have time to look through their closets and find old clothes they wish to donate. Shoes are welcome, too.

Of course, some residents may use this as an opportunity to dispose of their torn or tattered clothes. As such, as part of the announcement, make it clear that the HOA will only accept clothes in reasonably good condition. To ensure this, assign a few people to do a quality check.

 

4. Host a Fundraiser

Homeowners associations hold fundraisers all the time, but it is usually for their own gain. This Easter, change things up and host a fundraiser where you donate all the proceeds to a charity or local organization.

Here are some of the most common types of fundraisers:

  • Bake-sales. Residents can bake their own cookies, cakes, and other pastries to bring to the bake sale. Choose a suitable venue and invite guests to come over, too.
  • Yard sales. This is an opportunity for residents to get rid of their old or unwanted items for a cause. Like the bake sale, you will need a space big enough to accommodate everyone and everything.
  • Carwashes. Another fundraiser that requires a large space, a car wash can be a great way to raise money for charity.
  • Auctions. Ask residents to donate fairly valuable items they no longer want or need. Then, hold an auction where all the proceeds of the bids are donated.

While these fundraisers can work with just your community members participating, you have a higher chance of success if you decide to open the events to the general public as well. Make sure to advertise your fundraiser thoroughly so that you attract a lot of outside attendees and participants.

 

5. Offer Free Services

hoa community easter outreachYour community can come together and offer free services as a way to give back. You can organize your own temporary food shelter where you can feed the hungry and the homeless. You can even use the car wash idea and offer it free of charge to anyone who wants their car cleaned. The possibilities are endless.

One particularly apt service, though, is organizing an Easter egg hunt for kids outside of the community. These can be local kids, kids with disabilities, or kids from children’s hospitals.

But, planning an Easter egg hunt like this takes time. You need to partner with an organization like Make-A-Wish, Big Brothers Big Sisters, or even just a local charity. You also need to have volunteer community members to help, get an estimated number of attendees, and prepare all the materials in advance. As such, make sure to allow yourself at least 6 months to plan everything.

 

A Special Day for Everyone

While Easter is a great time to have fun with family and friends, it’s also the perfect time to help those in need. Make the most out of this special day by organizing one or more of these Easter community outreach programs.

 

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Community Association Management: Frequently Asked Questions

Community association management — a lot of people come across this term but don’t quite understand what it means and what it entails. If you want to find out, keep on reading.

 

What Is Community Association Management?

Community association management is the process of overseeing and governing a community association and its operations. Community associations can come in many forms, including homeowners associations and condo associations. Typically, a set of governing documents dictates how a community must be managed. This includes stipulations on how much to charge in association dues, what obligations homeowners have, and what authorities the community association possesses.

Additionally, many states have enacted their own laws that govern community associations. North Carolina, for instance, has the North Carolina Planned Community Act as well as the North Carolina Condominium Act. California, on the other hand, has the Davis-Stirling Common Interest Development Act.

Aside from community association-specific laws, there are also corporation laws that broadly apply to these organizations. In a lot of states, community associations are formed and recognized as corporations and must, therefore, abide by the corporation acts that govern them. To use the two states above as examples, these include the North Carolina Nonprofit Corporation Act and the California Corporations Code.

 

Frequently Asked Questions About Community Association Management

 

What Does Community Association Management Involve?

Managing a community involves performing numerous tasks that facilitate the smooth operations of the association. These tasks include but are not necessarily limited to:

  • Preparing the annual budget
  • Calculating and collecting association dues
  • Maintaining the association’s reserve fund (if applicable)
  • Preparing and presenting financial reports to the membership
  • Enforcing the covenants and rules of the association
  • association managementReviewing and amending the governing documents
  • Holding board meetings and annual membership meetings
  • Signing off on projects and initiatives
  • Soliciting bids as well as hiring vendors and contractors to complete various jobs
  • Managing payables
  • Conduct frequent inspections of the community’s common areas and elements
  • Maintaining the common areas of the community
  • Ensuring repairs for any damaged common areas
  • Communicate with homeowners, including sending out notices and making announcements
  • Tracking maintenance requests
  • Purchasing and updating insurance policies for the association
  • Planning and executing community events
  • Ensuring the association remains in compliance with changing laws

Tasks generally depend on a few factors, including the type of community association, the extent and nature of its common areas or amenities, and the size of its membership. Smaller communities with only a handful of common spaces to maintain typically don’t require as much work as larger ones with more comprehensive facilities.

 

Who Is Responsible for Community Association Management?

Community associations are generally managed by a set of board members collectively known as an HOA or condo board. Typically, board members fulfill different roles, such as a president, vice president, secretary, and treasurer. These board members are responsible for maintaining the community, i.e. fulfilling all of the duties listed above. More often than not, board members receive their designation by running for open seats and getting elected into office. Board members are volunteers, which means they are not paid and must still pay association dues like everyone else.

Because there are only a select number of board members and countless responsibilities to juggle, associations also typically set up committees. Committees are formed either perpetually or on an ad hoc basis. Each committee performs a specific function. For example, an Architectural Control Committee reviews requests for architectural changes and enforces the community’s architectural standards. A social committee, on the other hand, is tasked with planning events and functions as well as welcoming new homeowners into the community.

Many community associations also seek professional help in the form of a community association manager or management company. Professional managers essentially assume most of the responsibilities of board members. These include dues collection, homeowner communication, service request tracking, vendor management, and other duties listed above. Managers or management companies can also provide assistance with tax filings and legal matters as well as advise the board on decisions.

 

Do Community Association Managers Need a License?

It depends on the state you live in. Currently, eight states and the District of Columbia require managers to carry a community association management license. These are Alaska, California, Connecticut, Florida, Georgia, Illinois, Nevada, and Virginia. There are different certifications as well, such as Professional Community Association Manager (PCAM) and Accredited Association Management Company (AAMC).

 

How Much Do Professional Community Association Management Services Cost?

The cost of hiring a community association management company can vary depending on a few factors. These include the size of the community, the location of the community, the cost of living in the area, and the nature of a community’s amenities. The company you ultimately choose can also have an effect, as companies can charge different rates. On average, though, associations can expect to pay somewhere between $10 to $20 per unit every month.

 

Are Community Association Managers on the Board of an HOA?

No, community association managers are generally not part of the HOA or condo board. They are a separate entity whose role is to make the job of board members easier by shouldering most of the burden of community management. Managers should not make important decisions for the community. They can merely advise board members, who reserve the ability to make a final decision.

 

Do All Communities Need a Manager?

community association management servicesCommunity associations come in different shapes and forms. Whether or not an association needs the help of a professional manager will depend on its unique situation. There are many communities that get by just fine with self-management. But then, there are also many that require expert assistance.

Generally, hiring a manager is the best option if the HOA or condo board is inexperienced. Community management demands a certain level of skill and expertise, particularly when it comes to accounting and financial management. As such, if there is no one on the board who is well-versed in this field, it is a good idea to hire a manager. Many boards also lack sufficient time to manage the community. After all, board members are just volunteers who have their own personal responsibilities to deal with.

 

Community Association Management Made Easy

As you can see, community association management is not something all boards can accomplish alone. If hiring a professional manager or company is not in the cards, consider investing in management software instead. A community management software can automate many tasks and generally make the job easier. The software also comes with built-in tracking capabilities, allowing for more seamless and accurate reporting.

If you need reliable management software, look to Condo Manager. Call us today at 800-626-1267 or contact us online for a free demo.

 

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9 Of The Most Interesting St. Patricks Day Facts

The Feast of Saint Patrick is a widely celebrated occasion in the United States. But, not everything you know about the celebration may be true. Educate yourself by reading through these St. Patricks Day facts.

 

Interesting St. Patricks Day Facts Everyone Should Know

While the United States government does not recognize St. Patrick’s Day as a federal holiday, millions of people across the country still take the time to celebrate the grand occasion. With over 31.5 million Americans boasting Irish ancestry, this doesn’t come as much of a surprise. But, there are still some St. Patricks Day facts that may surprise you.

 

1. The Birthplace of Saint Patrick

Saint Patrick is known as the patron saint of Ireland, but did you know that he wasn’t even born there? Many historians believe that Saint Patrick was born in Britain at the end of the 4th century. When he was 16 years old, Irish raiders kidnapped him. He was subsequently sold to a Celtic priest as a slave in Northern Ireland. He spent 6 years working as a shepherd before making his escape back to Britain.

How did he find his way back to Ireland? Well, eventually, Saint Patrick returned to Ireland as a missionary, introducing many parts of the country to Christianity. Interestingly, Saint Patrick was not even born as Patrick. Instead, he was born Maewyn Succat. Later on, he took the name Patricius during his religious journeys.

 

2. The Significance of the Shamrock

St. Patricks Day FactsThe shamrock has long been the symbol of St. Patrick’s Day. You will find it everywhere around this time of the year — from shoddy bar merchandise to your local arts and crafts store. It is even a popular party costume.

But, what exactly is the significance behind this three-leaf clover? Well, it is said that Saint Patrick had used the shamrock as a way to preach Christianity, likening its three leaves to the Holy Trinity. The Celts called it seamroy and considered the plant sacred.

 

3. The Color Blue

Perhaps one of the most fascinating St. Patricks Day facts is that the celebration was initially associated with the color blue — not green. The change is believed to have happened because of the green color in the Irish flag as well as the day’s connection with shamrocks. Additionally, Ireland is known as “The Emerald Isle.” Today, it is nearly impossible to go out on St. Patrick’s Day without seeing the color green.

 

4. Most Consumed Beverage

If you love celebrating St. Patrick’s Day, then you probably already know the answer to this. Drinking is one of the most popular ways to celebrate the occasion, so it should come as no surprise that beer is one of the most consumed beverages on St. Paddy’s Day.

While many pubs and bars dye their beer green to commemorate the event, one particular brand of beer remains at the top: Guinness. In fact, as part of the St. Patrick’s Day celebration, an estimated 13 million pints of Guinness is consumed worldwide.

 

5. The First St. Patrick’s Day Celebration in the U.S.

The United States has been celebrating St. Patrick’s Day for a very long time, which makes sense considering there are millions of Americans claiming to be of Irish descent. But, did you know that the first St. Patrick’s Day celebration in the country took place in Boston in 1737?

This is not when the first St. Patrick’s Day parade occurred, though. According to history records, the tradition of holding parades, which originated in America, began in 1601 in what is known today as St. Augustine, Florida. And we have Ricardo Artur, the Irish vicar of the Spanish colony, to thank for it.

 

6. Chicago’s Unique St. Patrick’s Day Celebration

While cities across the United States celebrate St. Patrick’s Day with parades and pub crawls, Chicago is quite unique. On the morning of their St. Patrick’s Day parade every year, the Windy City dyes the Chicago River green for a few hours. Visitors can view the green river between Columbus Drive and State Street. The dye is environmentally-friendly, though, so it does not do any harm to the river or its inhabitants. The first time the city ever dyed its river green was in 1962.

 

7. The Shortest St. Patrick’s Day Parade

St. Patrick’s Day parades have become a staple in many cities across the globe, and no two parades are exactly alike. Some go on for a long time, while others only last a little while. But, the shortest St. Patrick’s Day parade takes place every year in Hot Springs, Arkansas. The parade has a route that only measures 98 feet (about 30 meters) long.

Before Hot Springs, though, the record for the shortest St. Patrick’s Day parade was 295 feet (90 meters) long. The parade took place in Dripsey, a village in County Cork, Ireland.

 

8. Female Leprechauns Don’t Exist

St. Patricks Day FactsAccording to Irish folklore, leprechauns were known as “lobaircin,” which translates to “small-bodied fellow.” The origin of leprechauns likely comes from the Celtic belief in fairies.

But, did you know that there are no records of female leprechauns in Celtic folktales? If that is the case, how do leprechauns procreate? Well, some believe that leprechauns are actually the unwanted children of fairies. As such, folktales have always described them as cranky and untrusting creatures in folktales.

 

9. Four-Leaf Clover Odds

Shamrocks are three-leaf clovers, and it takes a rare genetic mutation for clovers to have four leaves. This is why it is so hard to find a four-leaf clover. It is also why many people associated the four-leaf clover with luck. In addition to luck, according to Irish Celtic beliefs, each leaf on the four-leaf clover represents love, faith, and hope. But, what are even the odds of finding a four-leaf clover? According to calculations, about 1 in 10,000.

 

The More You Know

St. Patrick’s Day is just around the corner. But, before you go on that pub crawl or watch another parade, it is important to first learn some interesting St. Patricks Day facts. Who knows? These facts may be the answer to questions at your next St. Patrick’s Day trivia night!

 

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What Is An HOA? FAQs Answered Here

Many people have probably heard about homeowners associations. But, what is an HOA anyway? And what does it mean to live in a community managed by one?

 

What Is an HOA? HOA Meaning Explained

In the process of searching for a new home, you might come across properties listed as belonging to an HOA. But, what does HOA mean?

HOA is short for homeowners association. A homeowners association is an entity tasked with the management and maintenance of a planned community. These associations come in many forms, including single-family homes, townhomes, and condos. When a home is part of an HOA, buying it means automatically becoming a member of that association.

 

What Is the Purpose of an HOA?

So your home is part of a homeowners association — will anything change? What is the point of an HOA exactly?

The primary function of an HOA is to maintain the community and preserve property values. There are many moving parts when it comes to community management, and there is typically a set of HOA board members calling the shots. These board members, while unpaid volunteers, are elected into position by a vote from the membership.

The HOA board ensures the community remains in good condition by performing several duties, including but not limited to:

 

The Pros and Cons of Association Living

What does it mean to live in an HOA? As with a lot of things, living in an HOA community comes with pros and cons. Before you buy a home managed by an HOA, make sure to consider both sides of the coin. This way, you don’t end up stuck in a situation of your disliking.

 

What Are the Advantages of a Homeowners Association?

First of all, homeowners who live in an HOA community obtain access to its common amenities and facilities. While these amenities can vary from one association to another, usual amenities include swimming pools, clubhouses, and fitness centers. There are also HOAs that have their own parks, tennis courts, and golf courses. Additionally, more often than not, these amenities are only available for member use.

Another benefit of homeowners association living is that homeowners get all sorts of convenient services. This can range from snow removal and trash disposal to landscaping. Homeowners also don’t need to worry about keeping the neighborhood clean and well-maintained, as HOAs are tasked with this very job. As such, most HOA communities boast excellent curb appeal and high property values.

Finally, nothing compares to the sense of community that living in an HOA can offer. Because HOAs typically organize social events, you get a chance to meet your neighbors in a social setting and get to know them. In comparison, when you live outside of an HOA, you probably won’t even know who your neighbors are.

 

What Are the Disadvantages of an HOA?

Of course, homeowners associations also pose their fair share of disadvantages. One of the main downsides of HOA living is that you don’t get a lot of control when it comes to property use and modification. Many associations limit what you can do with your home, particularly when it comes to external changes such as paint color, building a shed, and how tall your fences should be. There are also several other rules to follow, such as noise rules or quiet hours, parking rules, and pet policies.

It is worth noting, though, that these rules do serve a purpose. They exist to maintain order in the community and preserve its overall appeal. Without these rules, a neighborhood can quickly become chaotic — with untrimmed hedges, cars parked everywhere, and mismatched house colors.

Having to pay HOA dues is another commonly cited disadvantage of homeowners association living. But, as with rules, dues play an important role in the association’s operations.

 

Can You Refuse to Join a Homeowners Association?

Generally speaking, you can’t refuse to join a homeowners association. For a large majority of HOAs, membership is automatic and mandatory once you buy a home in the community. Membership, though, shouldn’t come as a surprise. Your real estate agent and seller should inform you prior to closing that the home belongs in an HOA. Additionally, they should provide you with a copy of the association’s governing documents and financials. This way, you can gauge whether or not joining that particular HOA is a good decision for you.

 

What Are HOA Fees?

Living in an HOA community also means having to pay a homeowners association fee. What is an HOA fee? Paid either monthly or annual, these recurring dues go toward the association’s operating fund to pay for the various expenses of the community. After all, maintaining an HOA doesn’t come free. Moreover, a portion of these dues also goes to the HOA’s reserve fund, which is used to pay for major replacements and repairs in the future.

What do HOA fees cover? It depends on the expenses of your community. Common examples of HOA expenses include:

  • Insurance premiums
  • HOA management fees
  • Maintenance and repair costs
  • Landscaping fees
  • Common utilities

Everyone in the community, even members of the HOA board, must pay HOA dues.

 

Raising Fees: Is It Allowed?

Do HOA fees go up? In a word, yes. Homeowners association fees don’t remain the same forever. Dues are calculated based on the budget for the year’s expenses. When expenses go up, so do HOA fees.

There are many factors that can affect an association’s budget and fees. These include the rising cost of goods (i.e. inflation), increased wages, new common areas, and renovations. Additionally, if your HOA is trying to reach its appropriate reserve fund level, it may call for larger reserve contributions.

Bear in mind, though, that there are protections in place to keep HOAs from increasing dues too much. An HOA’s governing documents could impose a limit on increases. Similarly, some states have enacted laws that prevent associations from raising dues to a certain point. Arizona law, for instance, says that HOAs can’t raise dues by more than 20% per year without obtaining majority approval from its members.

 

What Are the Typical HOA Rules?

As briefly discussed in a previous section, homeowners associations usually have rules in place to maintain order in the community. While these rules can vary from association to association, typical HOA rules include:

  • Exterior paint rules
  • increasing hoa dues because of inflationArchitectural rules
  • Lawn maintenance rules
  • Pet restrictions
  • Parking rules
  • Vehicle restrictions
  • Noise rules
  • Guest rules
  • Holiday decoration restrictions
  • Rental restrictions

 

Can an HOA Evict a Homeowner?

The short answer is yes. When a homeowner defaults on their dues payments, an HOA has several options available. Most start with a stern notice informing the owner of their delinquency. Many associations also impose a fine for the late payment. If an owner still fails to settle their unpaid dues, HOAs will place a lien on the property, at which point they can choose to initiate foreclosure proceedings.

 

Your Questions Answered

Living in a homeowners association can definitely be confusing. But, what’s even more confusing is when you get behind the wheel. Managing an HOA community is not as easy as it seems, as evidenced by the many duties board members must fulfill.

If your HOA board needs help, perhaps it’s time to automate your processes and invest in an HOA management software. Call Condo Manager today at (800) 626-1267 or contact us online for a free demo.

 

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