HOA Dues Payment methods under Calif. law

Started by MarkT4 • 8 replies • 1813 views

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MarkT4 (California)
Posts: 4

Posted:

what are the methods of making regular HOA dues / assessments payments as prescribed by California law?
If any, where is it written?

RichardP13 (California)
Posts: 1,767

Posted:

To the best of my knowledge, there is no California law or statue that prescribe how a homeowner pays his assessment. Our Association has various options available:

1) Check
2) Automatic Debit
3) Online Payment through the Association website (PayPal)

Lenders will not get involved with setting up escrow accounts for homeowners as communication with Associations and their management companies too difficult.

MarkT4 (California)
Posts: 4

Posted:

we have them mail a check. QUESTION: can the HOA Board dictate the form of payment ? thereby precluding other options like a) paying cash! b) money orders (believe it or not).

RichardP13 (California)
Posts: 1,767

Posted:

No the Board can't dictate the form of payment. IF, an owner has had numerous checks returned then they could require a money order or certified check, but I would never give someone cash like that.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Richard,

I disagree. I believe the HOA has the authority to dictate the form of payment, i.e. check or money order; no cash. When I was treasurer of a small HOA (49 homes) there was a time or two when I accepted payment in cash, gave a receipt to the member, and cautioned them that I would not accept cash again. I didn't want to turn away a payment even though it was from a member who was not noted for being delinquent.

MarkT4 (California)
Posts: 4

Posted:

Our HOA consists of 39 homes. Older demographic. I do not want to accept cash (although it is [still] legal tender). The other issue is the designated place of payment. Our quarterly invoice specifies a P.O.Box (our accountant). What I am trying to ascertain is 1) can we dictate that payment will be by check or money order only and, 2) payment must be mailed to P.O.Box 1234. This would avoid a practice by some of making payment to other individuals who in turn deliver to the accountant. I do not know if it is the cost of a stamp, health issues or just a neighbor helping a neighbor. Ideally, I would like all residents to pay by check and mail payment to the designated address (for processing). I don't think that is unreasonable but seek clarification. I appreciate your input.

JanetB2 (Colorado)
Posts: 4,219

Posted:

Inform everyone that all payments are to be made to PO Box 1234 as this insures security of HOA funds. Then nicely point out ... The HOA would prefer no cash payments to protect our homeowners, because if cash payments are sent to the PO Box they would not have proof that their payment was received and processed. If an issue ever arose and their payment is not processed, they would need to show possibly a cancelled check that payment was actually made and processed by the accountant. If you send cash then you would not have protection for yourself.

You will probably find that most everyone will not be willing to send cash through the US Mail. And they will jump on board when they feel this is all about "protecting them" with a valid reason and protecting everyone's HOA funds.

MarkT4 (California)
Posts: 4

Posted:

Thanks Janet. No one is sending cash by mail. Rather a few give cash to another who "facilitates" payment. Trusting aren't they. Your point re security is taken. Do you know if dictating the form of payment, the delivery of said payment or determining designated place of payment (by the Board) is a violation ? I can't imagine it is but hope there is a definitive statement somewhere (preferably a legal reference). I know this sounds terribly old-fashioned. It is, but I would like to cover all the bases.

JanetB2 (Colorado)
Posts: 4,219

Posted:

Most business type entities tell individuals where to send payments and that is where you must send them for (i.e., mortgage payment, utilities, etc.) I believe an HOA is no different and could designate a place to send payments without it being a violation.

If you designate the place to send and state that no HOA directors or officers will accept any payments from homeowners (Officers must follow through and NOT accept payments). Eventually everything will soon flow as needed, especially if you are positive with everyone that it this is to protect them against any mishandling of money. I personally would not "disallow" cash as you want the payments period ... no matter how sent. Just stress why it is not a good idea to send cash. If owners send to a PO Box then you will probably receive very few cash payments anyway as most will send check or some other traceable form of payment.

I could provide legal references for CO statutes, but sorry I do not know CA statutes. You might go to google.com and search for ("California" "HOA payment options") and see if any legal statutes or sites offering advice come up for you to read and research. Or maybe someone from California on this site will know of a legal reference for you.

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