changing management company, hard to do??

Started by StaceyF1 • 3 replies • 1129 views

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StaceyF1 (Arizona)
Posts: 6

Posted:

Our current board is not enamored with the management company that has been in place for the past 6 years. If this board was to investigate a replacement management company how much difficulty is involved to switch? I'm sure some of you have done this and what is really needed to make a switch with the least problems.

TimB4 (Tennessee)
Posts: 21,059

Posted:

We don't use management companies, therefore this info is not from personal experiences. From what I've read, you should:

1) Read the existing contract to see how the contract can be terminated or if there is any notice requirement if you are not going to renew the contract.

2) Slowly, start taking custody of finances and files.

3) Write out a statement of what services you will want the new MC to provide. Don't forget frequency and type of reports (if you want to get into that much detail). This is so you can compare apples to apples.

4) Solicit bids (send your statement with a cover letter explaining the size and location of your association to various MC requesting that they bid on the proposal).

5) As a Board, review the bids, check references, perform interviews and select the best fit.

6) Arrange a date and method (MC to MC or MC to Association to MC) for the records to be turned over.

DavidW5 (North Carolina)
Posts: 565

Posted:

We changed management companies 3 years ago after an elected homeowner board took over from the developer. The management companies in our area are quite familiar with the process of transition to/from another management company. The transfer of files and records went pretty smoothly. The new company was very proactive in communicating to our members, explaining the changes that would need to be made (e.g. sending dues payments to a new address, etc.) There were a few minor glitches but we went from an expensive, poor-performing company to a much more responsive company at a significantly lower cost. The change was well worth the effort.

Be sure to ask any potential new management company how they would handle the transition. A good company will have a written plan with a detailed timeline showing when various actions will be completed. Make sure that a senior person from the new company is named as the point of contact for all transition planning and implementation.

Good luck.

JoK2 (California)
Posts: 198

Posted:

It is not hard to do, as long as all parties are protected, meaning the HOA, and both management companies. Tim's advice is spot on as usual! I would encourage you to identify just what your not enamored of because after we made the switch we thought we were better off, and we've just recently discovered that he was worse.

We didn't have much choice as the manager they were replacing was headed to jail, so we had to move quickly. Whether our desperation played a part in it or not, we'll never know. In hindsight, I would have identified the key areas of his responsibilities and how the board would follow up that's its all being done. That was our responsibility and we failed in some aspects of that duty.

That being said, make sure that the issues your not happy with are the responsibilities of the manager and not the board. Hope this helps.

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