RdH (Oklahoma)
Posts: 1
Posts: 1
Posted:
If a board members home is put in foreclosure can he/she continue as a board member. Also, this baord member has our community insurance through his company. Is that legal or conflict of interest?
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Board Member in Foreclosure
Started by RdH • 4 replies • 1438 views
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MelissaP1 (Alabama)
Posts: 13,836
Posts: 13,836
Posted:
As long as they are paying the HOA dues, they are a member. A bank foreclosure has no effect on the status of membership. It is the non-payment of dues/assessments that effect this.
There aren't alot of insurance companies out there. So I don't think it's that much of an issue with the insurance. It just depends if there were OTHER bids solicited prior to deciding to go with this insurer. That would be the only conflict I would see.
There aren't alot of insurance companies out there. So I don't think it's that much of an issue with the insurance. It just depends if there were OTHER bids solicited prior to deciding to go with this insurer. That would be the only conflict I would see.
Former HOA President
JohnM48 (Pennsylvania)
Posts: 89
Posts: 89
Posted:
The answer to both questions should be found in your HOA's organizing documents (By-Laws, CCRs) or your relevant state laws.
The question of foreclosure would most likely depend on the reason for foreclosure. If it is for non-payment of assessments, your docs may address this in requiring directors to be MiGS. If the dues are paid and the foreclosure is for other reasons, it is likely irrelevant.
Regarding the question of insurance - it is certainly an imprudent thing to do, and may be prohibited by your docs or state laws.
The question of foreclosure would most likely depend on the reason for foreclosure. If it is for non-payment of assessments, your docs may address this in requiring directors to be MiGS. If the dues are paid and the foreclosure is for other reasons, it is likely irrelevant.
Regarding the question of insurance - it is certainly an imprudent thing to do, and may be prohibited by your docs or state laws.
Association President
SteveM9 (Massachusetts)
Posts: 3,699
Posts: 3,699
Posted:
Quote:
Also, this baord member has our community insurance through his company.
He is likely just the insurance broker. I would call the actual insurance company to see if you indeed "have" a policy. Who knows.... maybe he's been keeping the insurance payment and not taking out a policy. Makes you wonder, if hes not paying his mortgage, what else is he not paying.
Its smart to double check.
SteveW13 (California)
Posts: 11
Posts: 11
Posted:
Unless your covenants say otherwise, I would have to say that he/she
would be able to remain. With that said, is that the best thing for the
community? I would have to say no. Look at it this way. Would you want
someone in financial straights managing tens of thousands of dollars in
various checking and ressere accounts? If they can't manage their own
finances, why trust them with managing the communities money? I'd say petition the remaining board members to remove him/her immediately (ESPECIALLY if that person is president).
In regards to the insurance, it is absolutley a conflict of interest unless this person divulged to the rest of the board that he already
had a business relationship with the insurance company.
Steve
would be able to remain. With that said, is that the best thing for the
community? I would have to say no. Look at it this way. Would you want
someone in financial straights managing tens of thousands of dollars in
various checking and ressere accounts? If they can't manage their own
finances, why trust them with managing the communities money? I'd say petition the remaining board members to remove him/her immediately (ESPECIALLY if that person is president).
In regards to the insurance, it is absolutley a conflict of interest unless this person divulged to the rest of the board that he already
had a business relationship with the insurance company.
Steve
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