Delinquent Homeowner dues collections procedure

In last month’s newsletter, I wrote about delinquent homeowner dues and how the boards can become more aggressive with collections.

This month I will focus on what the state of Florida has done to help Hoa /condominium boards in terms of regulations that has helped many associations recover some, if not all back dues.

Basically, the new law allows associations to collect fees directly from renters if the owner-landlords don't pay up! If a renter pays rent to an owner-landlord that is at least 90 days behind in their dues the association now has the right to grab that monthly rent check that is heading to the owner-landlord. This law has been on the books for some time but I wanted to bring it up again since there are so many boards that are not taking advantage of this law.

It amazes me how some boards are shying away from this tough stance at the expense of the others. Maybe it’s because the boards do not want to offend anyone. Maybe it’s because the boards want to live in peace and not get their car/home or any other personal item vandalized. But whatever the reason is one thing is certain, the board has a fiduciary responsibility to all homeowners. This is a tough statement but it’s true. Boards have a very tough job. They have to run the association with everyone in mind not just a few. So what is a board to do? Where should the board start?

Before any collections of rent start, my first call would be to your attorney. I always recommend asking your in-house attorney for advice in matters like this. Most firms are now experienced with this type of collections procedures and have the tools to help. For example, some law firms have specially designed forms specifically for tenant rent collection. Some attorneys have short forms some have long forms like the law firm I worked with in Orlando, Florida which had a three page notice that went to the tenant and the owner-landlord.

In any case, once the owner-landlord / tenant receive the notice be prepared because the calls will start coming in. And keep in mind most tenants haven’t heard of such a law. As far as their concerned, they have a lease with the owner-landlord not with the association.

It‘s amazing how this new law has helped so many associations recover past dues. It’s also amazing how few boards are taking advantage of it. Again, maybe the boards do not want to offend anyone. Maybe they are in fear of their personal property whatever the reason you, as a board member, should make it your priority to get the monies due your association.

So, you may ask where do you start? How can my board try and limit exposure to retaliation? The answer is simple. Hire a management company to handle the dirty work. By hiring a competent management company you help insulate yourself, somewhat, to direct retaliation. By hiring a competent management company you now have a buffer between you and the owners / renters. Let the management company take the full force of the upset homeowners /renters anger / fears. You have enough to worry about. Right? You don’t need aggravation and late night door knocking. What you need is an efficient and predictable way to handle these types of situations, especially in this very tense environment we are now living in.

So, if you need advice, feel free to contact me. I will help anyway I can. But please start a program, any program, that captures renters monies going to delinquent homeowners pockets instead of your association’s where it belongs.

I have a more detailed plan I used in the past for other associations. If you would like a FREE copy just simply call or email me your request. I will be happy to send it to you free of charge.

561-707-4900

Frank LaMorte

Lcam, Broker Associate

Schlitt Property Management

Coldwell Banker Commercial

Frank.LaMorte@ColdwellBanker.com