HOA Document request and poor record keeping

Started by BobS30 • 9 replies • 1207 views

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BobS30 (California)
Posts: 5

Posted:

Hello,

Background:
My community is a 6 unit condominium in California. My father is the current president, but due to his declining health I've been helping him with his duties. The vice president doesn't speak English so she's unable to communicate in matters where English is used, so effectively there is no vice president, hence my involvement.

Problem:
We've recently received an HOA document request from an escrow service due to a member selling their home. They've already submitted an authorization letter.

Unfortunately the records have not been well maintained and not all meeting minutes from the past 3 years have been filed either. There are other lost or misplaced documents. For example, there's no documentation for a ratified budget for the current year, but the treasurer is in the process of creating the budget for next year, which obviously its yet to be ratified too. There are copies of the CCRs and Bylaws, and

How do we submit the documents that we do have to the escrow service if they're not complete? What type of notations do we need to make? Should the president or secretary/treasurer be dealing with the escrow request?

How do we go about rectifying this situation going forward and hold the other/new board members/officers accountable to their duties?

I'm trying to educate myself about obligations of board members and the HOA, but I'm feeling completely overwhelmed at the moment. Its obvious this HOA is being mismanaged. Would a management company help in this situation?

Any advice would be greatly appreciated.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Bob,

Welcome to the forum.

I expect that you do not have a management company to assist you.

As for your question, you submit what you have.
For glaring mistakes, you submit a written explanation (but simple and just the facts).

Example:

The following documents are unavalable:
a
b
c
d

We apologize for this error.

Keep in mind that there may be a time schedule to keep with such requests.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Bob,

Wouldn't the Secretary and Treasurer be in charge of these things?

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Bob

As far as the budget requirements, can you cobble together the past few years Actual Budget as in what was collected and what was spent. Also cobble together 2016 Actual To Date. I expect you could quickly create a 2017 Proposed Budget. Remember, it will be Proposed 2017 Budget so it could change.

I expect what is being looked for is that you do not spend more than you take in.

BobS30 (California)
Posts: 5

Posted:

From I'm seeing in articles regarding officer duties, that's what the treasurer/secretary positions should be doing. Since the HOA is so informally runned, it seems the the duties are now being blurred.

BobS30 (California)
Posts: 5

Posted:

Quote:

Posted By TimB4 on 11/12/2016 5:44 AM
Bob,

Welcome to the forum.

I expect that you do not have a management company to assist you.

As for your question, you submit what you have.
For glaring mistakes, you submit a written explanation (but simple and just the facts).

Example:

The following documents are unavalable:
a
b
c
d

We apologize for this error.

Keep in mind that there may be a time schedule to keep with such requests.

Yes that's correct, we don't have a management company though I've been doing research to bring that up for the next meeting.

So for example would something like this be ok?

Due to unforeseen circumstances, the following documents are unavailable:

A. Meeting Minutes regarding repair deferment from 2001
B. Meeting Minutes regarding amending ccr's from 2002
B. Reserve study from 2003

We Apologize for this error.

BobS30 (California)
Posts: 5

Posted:

Quote:

Posted By JohnC46 on 11/12/2016 6:37 AM
Bob

As far as the budget requirements, can you cobble together the past few years Actual Budget as in what was collected and what was spent. Also cobble together 2016 Actual To Date. I expect you could quickly create a 2017 Proposed Budget. Remember, it will be Proposed 2017 Budget so it could change.

I expect what is being looked for is that you do not spend more than you take in.

The treasurer stated they were going to create the budget for submission to the escrow service, however they didn't mention if they'd be generating the last few year's budget or not. I'm somewhat kept in the dark since their responses are generally short and without detail.

RichardP13 (California)
Posts: 3,868

Posted:

Bob

Being 6 units, owners sometimes don't realize that they have the same responsibilities as those that live in 1000 unit complex. Being you're in California also adds to an HOA's legal responsibilities.

You ask if you should have management. The answer is YES, if the Board is unsure of what their legal obligations are. It doesn't need to be full management, but financial management, which should include sending assessments out, collecting on those assessments, paying what bills you might have, preparing tax returns, updating your status with the Secretary of State's office, preparing the proper disclosures needed to be sent twice a year and handling escrow inquires.

Unfortunately, saying that certain documents are unavailable, and sorry for the error generally won't cut it. You could have a legal challenge after the fact once a buyer closes escrow without the necessary documents.

For a couple hundred dollars a month you could have someone handle the day to day compliance issues for the HOA, while the Board actually manages the property. Many headaches potentially avoided.

BobS30 (California)
Posts: 5

Posted:

Quote:

Posted By RichardP13 on 11/12/2016 11:15 AM
Bob

Being 6 units, owners sometimes don't realize that they have the same responsibilities as those that live in 1000 unit complex. Being you're in California also adds to an HOA's legal responsibilities.

You ask if you should have management. The answer is YES, if the Board is unsure of what their legal obligations are. It doesn't need to be full management, but financial management, which should include sending assessments out, collecting on those assessments, paying what bills you might have, preparing tax returns, updating your status with the Secretary of State's office, preparing the proper disclosures needed to be sent twice a year and handling escrow inquires.

Unfortunately, saying that certain documents are unavailable, and sorry for the error generally won't cut it. You could have a legal challenge after the fact once a buyer closes escrow without the necessary documents.

For a couple hundred dollars a month you could have someone handle the day to day compliance issues for the HOA, while the Board actually manages the property. Many headaches potentially avoided.

Thank you. I understand it won't absolve us of legal responsibilities, but I do want to at least make sure I'm submitting documents correctly without compounding issues.

RichardP13 (California)
Posts: 3,868

Posted:

Bob

Check this website link to see what is required. http://www.davis-stirling.com/MainIndex/RealEstateMenu/tabid/659/Default.aspx

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