What NOT to Do When Collecting HOA Fees
When even just a few homeowners fail to pay their HOA fees, it can have a huge – and instant – impact on an association’s budget. Unpaid fees may also lead to a ripple effect. When multiple homeowners fail to pay their fees, banks may become less likely to approve mortgages in the association, and this can result in lower property values.
Homeowners associations should make an effort to work directly with homeowners who fall behind on their fees. We all face unexpected situations and financial emergencies, and it’s important for homeowners to know that their association will work with them and adhere to the Fair Debt Collections Practices Act (FDCPA) when collecting unpaid assessments.
Are your collection tactics in line with the acceptable practices set forth by the FDCPA? Here are a few things not to do when collecting HOA fees.
What NOT to Do When Collecting HOA Fees and Assessments
In many federal and state courts, HOA fees and assessments are considered debts. These debts must be collected by homeowner associations, and under the FDCPA, those who collect debts from individuals must do so using tactics that are not considered invasive.
Specifically, the FDCPA prohibits homeowners associations from:
- Harassing homeowners
- Threating homeowners with violence or harm of any type
- Publishing the names of homeowners who are behind on their fees or refuse to pay
- Annoying homeowners with frequent, repeated phone calls
- Depositing a post-dated check from a homeowner early
- Misrepresenting the total amount a homeowner owes
- Sharing personal information without the homeowner’s permission
Under the FDCPA, homeowners associations must also notify homeowners in writing when there are delinquent fees or assessments. This document must state that it is an attempt to collect a debt, and it must include the association’s name, the exact amount owed and that the homeowner has 30 days to dispute the debt in writing.
If an association violates any of the rules set forth by the FDCPA, they may be liable to the homeowner for court costs, attorney fees and damages.
Help Collecting HOA Fees
Collecting past due fees and assessments is a job that no association enjoys, but it’s a job that nearly every association must face from time to time. For help collecting unpaid fees and assessments, consider hiring a professional property management company. At AMI, we offer a full range of financial management services, and we can take care of the often unpleasant task of collecting fees and assessments in a manner that is consistent with the law.
For homeowners association financial management services in the Bradenton area, please contact AMI today.Tweet