MaryS37 (Illinois)
Posts: 3
Posts: 3
Posted:
Does Board of Director's have the right to take out a line of credit on your reserve account.
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Started by MaryS37 • 6 replies • 1601 views
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MaryS37 (Illinois)
Posts: 3
Posts: 3
Posted:
Does the Board of Directors have a right to borrow a line of credit on your reserve
JohnC46 (South Carolina)
Posts: 14,265
Posts: 14,265
Posted:
Mary
I am not nor do I play a lawyer.
The simple answer to your questions is they more then likely have the right to do so. The answer to their ability/power to do so will be in your Covenants and/or Bylaws.
I am not nor do I play a lawyer.
The simple answer to your questions is they more then likely have the right to do so. The answer to their ability/power to do so will be in your Covenants and/or Bylaws.
FredS7 (Arizona)
Posts: 927
Posts: 927
Posted:
> Does Board of Director's have the right to take out a line of credit on your reserve account.
And if they CAN it might or might not be the right thing to do.
This is likely to be considered when there is an expense too large to fund from reserves. The alternatives are (1) deferred maintenance and (2) special assessment.
And if they CAN it might or might not be the right thing to do.
This is likely to be considered when there is an expense too large to fund from reserves. The alternatives are (1) deferred maintenance and (2) special assessment.
KellyM3 (North Carolina)
Posts: 2,239
Posts: 2,239
Posted:
A line of credit or a loan taken out because there aren't enough Reserve Funds should be viewed as a "special assessment."
BruceF1 (Connecticut)
Posts: 2,535
Posts: 2,535
Posted:
Quote:
Posted By MaryS37 on 08/13/2014 11:33 AM
Does Board of Director's have the right to take out a line of credit on your reserve account.
Does Board of Director's have the right to take out a line of credit on your reserve account.
The answer probably can be found in your CCRs and/or in your state laws. Look for something like "the right to assign future income" and whether that power resides with the board or requires a vote by the homeowners. The right to assign future income means the right to borrow money.
KerryL1 (California)
Posts: 14,550
Posts: 14,550
Posted:
Are you on the Board, Mary?
What does the Board say the funds are needed for?
What does the Board say the funds are needed for?
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