Assessments are the lifeblood of any community association. They’re vital to maintaining common areas and serving all homeowners and residents living in the community. Today, we are going to talk about delinquent assessment collections in community associations. Following these tips will reduce and prevent your delinquent assessments.

Create a Proactive Collection Policy

Proactive collection policies are an important part of on-time payments. Boards have a fiduciary responsibility to make sure that assessments are levied and collected. Creating and implementing a formal policy is the best thing a community can do. With a collection policy in place, the process of assessments will be consistent and enforceable.

Once the collection policy is written, it should be passed by a board resolution. The governing documents will also need to specify the actions that will be taken to collect assessments and to prevent their delinquency.

After the board votes on and adopts the collection policy, it must be distributed to every owner in the community.

Enforcing the Assessment Collection Policy

The collection policy must be uniformly enforced, and the board should be empowered to pursue all legal remedies to collect delinquent assessments. This includes hiring an attorney who specializes in debt collection. The attorney can seek a number of remedies when assessments are not being paid by community members. There can be personal judgments won, which may be executed by way of levies with the sale of personal property or vehicles.

An attorney can also garnish the debtor’s bank account or implement a wage garnishment to recover the money that is owed. If an owner who has not paid the assessment is leasing their property to a tenant, it’s possible to garnish the rental income that’s earned.

Your board’s attorney can also file a lien against the property and foreclose using a judgment or a statutory lien.

Suspending a Debtor’s Community Rights

In addition to the many legal remedies that a collection attorney can help with, communities can also restrict or repeal a homeowner’s community rights when their assessments have not been paid. For example, you can suspend a debtor’s right to vote on community issues. You can also restrict the debtor from serving on a board or a committee until the debt is paid. Attending social functions will not be allowed, and you can restrict access to common areas such as pools, fitness facilities, and other recreational amenities at the community.

Delinquent collections need to be proactive, swift, and consistent. It’s the only way to hold all of your homeowners accountable for the assessments that are agreed to when they buy within the community. It’s most beneficial for boards, owners, and the entire community to have a consistent and formal policy in place.

We strive to work with boards and communities to minimize delinquencies and collect all assessments for the community’s benefit. If you’d like to hear more about how we can help your community association, please don’t hesitate to contact us at Realty Solutions.