Late Fees

Started by JoanneB2 • 9 replies • 1488 views

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JoanneB2 (Florida)
Posts: 25

Posted:

Our HOA deed restrictions state under Collection of Fees: Any such fee remaining unpaid by any such plot owner for a period of thirty (30) days following the date payable as specified hereinabove and shall thereafter be charged a late of $25.00. (The word fee was omitted in the document). An additional late fee of $25.00 shall be applied for each consecutive month on the 30th of that month that the delinquent plot holder account remains in arrears and shall become a lien against said plot, the amount of said lien to include said late fees and all costs or recordation, collection and enforcement of said lien, including reasonable attorney's fees.

There's been a recent change on the board of directors and now a review of the "books" discloses no late fees have been charged. I'm wondering what could possibly be the explanation?

JoAnne

NancyG3 (North Carolina)
Posts: 342

Posted:

JoAnne - You should ask your Board this question. Do you have homeowners that are arrears in their dues? Check in your Florida Planned Community Act as to what it says about what can be charged. If you are new to the Board work with them on charging the late fees.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Are there any late payers? Have people caught up and paid their late fees? Were they forgiven by any type of deal of avoiding a lien? Late fees may be waived in certain circumstances like payment plans. There could be a variety of reasons why late fees have not been applied. What are the regualer dues amount?

I am concerned about the 30 days before charging a late fee. That seems a bit more time than necessary and make it harder to tell if late fees are applied. Typically 10 - 20 days late is what I have seen if paying dues monthly. If you pay $100 in dues a month and always late for 4 months, the balance may show $100 if you didn't pay the late fees and dues only. It would be hard to see that $100 as late fees. One could think that is just another missed dues payment. I would wonder how late fees were shown on the books to know if they are or are not being collected.

Former HOA President

TimB4 (Tennessee)
Posts: 21,059

Posted:

Boards may waive fees but they can not waive assessments.

It's possible that the Board chose to waive those fees by not applying them (although it was the improper way of doing it, it's the same result as applying the fee and then waiving it).

In situations like this (when it's just the fees), it's typically better to move forward rather than look at the past. I would inform the membership that starting Jan 1, 2013, the Board will start complying with that section of the covenants and impose late fees for assessment installments that are not received by the last day of the month.

Tim

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

I agree. The past is the past and its just a late fee, not dues. I would vote to waive all the past late fees that are in question and start enforcing the policy from this day forward. Just to make it legal. Note, you cannot waive dues, just the late fees. They may not even be late fees if there was poor record keeping, dates wrong, etc. Incompetent people drive me nutty.

LarryB13 (Arizona)
Posts: 4,099

Posted:

Joanne,

If these late fees are in your CC&R's, then the previous board(s) had no authority to waive them.

I agree with the others that the past is just that, so your future actions should be governed by your deed restrictions and not the policies of past boards.

In answer to your question as to "what could possibly be the explanation?" the most likely answer is that no one on the board wanted to be the bad guy. Serving on the board has some unpleasant duties that go along with the job. Those who are unable to do those things should not offer to serve.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Larry

I would say late fees are waiveable by the BOD and often such waiver is used to aid people in catching up on their past dues.

Now applying such equally and fairly is another subject.

JoanneB2 (Florida)
Posts: 25

Posted:

I've spent several hours researching this matter. Seems the President, who was also the President when the Treasurer changed everything, had no explanation behind the action. Between June 2011 and July 2011, over $6,000 in late fees were eliminated - without the board discussing it or approving it - an action taken solely by the Treasurer. I agree that it would be a nightmare to try to go back now and add late fees. But it's a matter for the next board meeting and going forward.

I was on the board a couple years ago; got the community standards written and the color book put together; got members of the board to attend HOA training; got many bad practices stopped.
Then I was off the board for 2 years. Now back on and it will probably take my 2 year term to get everything straightened out again.

I'd be all for mandatory reading/training for board members. I hesitate to think about other boards who have people on them who don't have a clue as to why they are there.

Thank you all for the comments, I like knowing I'm headed in the right direction.

JoAnne

TimB4 (Tennessee)
Posts: 21,059

Posted:

Quote:

Posted By JoanneB2 on 10/23/2012 7:24 PM

I'd be all for mandatory reading/training for board members. I hesitate to think about other boards who have people on them who don't have a clue as to why they are there.

I actually created binders for each office with brief explanation and procedure of the duties expected of each office. The biggest thing I point out in each binder is that decisions are made by the board. The officers only implement those decisions and typically have limited or no other authority to take actions without board approval.

An officer may or may not read the binder but it's better than what we had for the last 30 years (nothing).

The binders have only been in place for two years and I've gotten positive feedback for them. Hopefully they will continue to be used and turned over to each Officer when I am no longer part of the Board.

BradP (Kansas)
Posts: 2,640

Posted:

This would be my stance if i were on your board...First i would make sure that assessments were paid, if they were then great, if not go after them. In terms of late fees it is very difficult to go back after someone for late fees especially if they were waived and the person who had incurred thought the board was waiving them. I simply don't see how you could win that one so I would leave it alone.

I think focusing on the now and moving forward is the correct course of action in your case.

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