Responsibility for HOA Dues

Who is responsible for paying the dues (Assessment or regime fees) to the HOA?

At a recent HOA board meeting, there was an incomplete discussion of the huge amount of unpaid dues owed to the HOA.

In a previous meeting where discussion had included the word "foreclosure", one board member said that the HOA is not in the business of putting people out of their homes. In other words, if a person doesn't pay his dues, don't foreclose on his house.

My response? The HOA is a non-profit corporation. IT IS NOT A CHARITY. 

If an Owner does not pay his dues and does not make a satisfactory arrangement of a payment plan (and comply with it!), then Foreclose.

At the recent meeting board directors' comments included that some of the debtors are dead; some have sold; some can't be found. Those remarks caused me to think that board members believe the unpaid dues are a personal, unsecured debt of the owner.

My reading of the CC&Rs (Art. X, Section 2) is that the dues are owed by the Property and payable by the named Owner on the Deed. It doesn't matter who owns it. Unpaid dues become a lien on the property. If a property is sold, the Closing Settlement Sheet should include the unpaid dues.

If an Owner dies and the house is sold, the HOA should get the unpaid dues then. The HOA should never lose out, unless there is no money left after the First Mortgage is paid or upon foreclosure. At least then, the new owner will begin paying dues, and the HOA will write off the loss.

For months I have believed there are major problems with the Association Policy for collection and the Collection Activity of the HOA, as administered by the CAMS office staff and the HOA's attorney.

As of 2/29/2024 Accounts Receivable are $544,396.08, and the Allowance for Uncollectible Accounts is $397,279.10. Some amount of the Accounts Receivable may been received on time between 2/29/2024 and 3/15/2024. The 3/31/2024 Financials will be available at the May 7th board meeting.

As of 12/31/2023 Accounts Receivable were $441,421.22, and the Allowance for Uncollectible Accounts was $397,279.10.

Your utterance about the amount of Accounts Receivable may be the same as mine - unprintable here.

The current Board of Directors has gotten stuck with a can that has been kicked down the road many times. This Board had better fix the problem.

Is the problem that efforts by CAMS to collect unpaid dues have been weak? Is the problem that efforts by the HOA's law firm to collect unpaid dues have been insufficient? Was the problem that previous boards were unwilling to take the actions required to protect the HOA and those many Members who do pay their dues on time?

See you at the May 7th board meeting. 6:30PM. Brookland Baptist Church Northeast. Stand up and ask your questions.

INVITATION: If any board member or Finance Committee member (or any reader) takes issue with what I have written above, please comment below or let me know directly.

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