Payment Plan Questions from Association Boards of Directors
What are the standard terms for HOA or Condo payment plans?
A payment plan must be reasonable for both the delinquent owner and the association. A payment plan going as far as five (5) years is unreasonable and really should not be considered. The standard is a twelve (12) month payment plan.
If the board agrees to a payment plan, does it need to be filed publicly?
It is not necessary to file a payment plan with a court. This is an agreement between the delinquent owner and the association and its agents.
Can a payment plan include late fines, legal costs, and other fees?
Yes, they can and should include all fees that have been legally assessed up to the date that the payment plan commences.
Can the board publish a list of homeowners who are on a payment plan for delinquent assessments?
No, you shouldn’t ever publish this sort of list, whether the debtors are on a payment plan or not. While the administration of a community association should maintain a roster of units on a payment plan there is no reason to publish such a list. Publishing a list for public distribution can cause not only legal liability but confrontation. Now, in some states owners are entitled to request detailed financial information and if that is the case then the curious can see who is on a payment plan, but only in the privacy of the management office.
Payment Plan Questions from Homeowners
Who decides if you can or cannot set up a payment plan for delinquent assessments?
If there are no state laws that require an association to offer a payment plan and if the governing documents of the association do not prohibit it the decision is up to the board of directors. All Board of Directors of a well-run association should have a Uniform Collection Policy that speaks to payment plans. Ask your manager or BOD for a copy of the rules and regulations where the collection policy should be.
Can I negotiate the amount to be paid back in a payment plan?
When it comes to the amount of the payment plan, some things are negotiable but NOT the principal assessments and special assessments that are owed. You can negotiate the length of the payment plan. You may also find that some collection agencies will waive off some of the collection charges (late fees and interest) if the payment plan is short enough to resolve a delinquency quickly.
How do I work out a payment plan when I am behind on my HOA dues?
The most important thing is to open a dialog with the individual who is tasked with working out payment plans. Some advanced collection agencies even have debtor facing portals where they give you the options to choose the length of your payment plan so that you do not have to talk to a customer representative. The main thing is to get up and sort this matter out as soon as possible before the association gets desperate and begins a foreclosure on your property. Don’t be shy — protect your home by getting this done right away.
Resolving a Delinquency is Always Better than the Alternative
Members of community associations should know how they may catch up with delinquent assessment payment plans for their Condo or HOA. Resolving a delinquency via a payment plan is the best result for this issue a community can hope for – not doing so only leads to heartache for homeowners whose homes are foreclosed upon, and unnecessary legal fees for the association. Owners should know that they can sort these matters out and boards of directors should make adequate provisions to do so.
In good times and bad times, Condos and HOAs need to be able to set up payment plans. If a unit is sent into collections, then this solution should also be contemplated and deployed. Contact a specialized collection agency like Axela Technologies to work with your association on resolving delinquency issues. If we do not collect, we do not get paid. Click here to contact us to schedule a time for a demonstration.
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