Late Assessment Fee Penalty

Started by RichA3 • 3 replies • 893 views

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RichA3 (Arizona)
Posts: 48

Posted:

There is no provision in our HOA CC&Rs or By-laws to assess a late payment penalty. The bylaws simply say,"On the first of each month, the owners of each unit shall pay as directed by the Board, the amount necessary to pay for operations". The coupon books sent to each unit owner do state that a late fee of $8.20 is assessed after 30 days. I believe this correlates to a 5% penalty...our monthly assessment fee is $164. Are we on shaky ground assessing any penalty not prescribed in our condo documents?

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By RichA3 on 02/17/2018 10:19 AM
There is no provision in our HOA CC&Rs or By-laws to assess a late payment penalty. The bylaws simply say,"On the first of each month, the owners of each unit shall pay as directed by the Board, the amount necessary to pay for operations". The coupon books sent to each unit owner do state that a late fee of $8.20 is assessed after 30 days. I believe this correlates to a 5% penalty...our monthly assessment fee is $164. Are we on shaky ground assessing any penalty not prescribed in our condo documents?

In California, late fees may be assessment 10% or $10.00 whichever is greater, UNLESS the governing documents state a lower figure.

Check you state statues on this matter.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Rich:

Since you used the term unit, I expect you are in a condominium development.

Per AZ 33-1255 [emphasis added]:

B. Except for assessments under subsections C, D, E and F of this section, all common expenses shall be assessed against all the units in accordance with the allocations set forth in the declaration pursuant to section 33-1217, subsection A. Any past due common expense assessment or installment bears interest at the rate established by the board subject to the condominium documents.

Since your Bylaws are silent about late charges, then an argument can be made that this section of the act applies.

Do the governing documents (CC&Rs, Bylaws, Articles of Incorporation) mention anything about late fees at all or are they all simply silent?

TimB4 (Tennessee)
Posts: 21,059

Posted:

Rich,

If I was wrong and you are in an HOA development, then AZ 33-1803 would be applicable.

per that act [emphasis added]:

A payment by a member is deemed late if it is unpaid fifteen or more days after its due date, unless the community documents provide for a longer period. Charges for the late payment of assessments are limited to the greater of fifteen dollars or ten percent of the amount of the unpaid assessment and may be imposed only after the association has provided notice that the assessment is overdue or provided notice that the assessment is considered overdue after a certain date. Any monies paid by the member for an unpaid assessment shall be applied first to the principal amount unpaid and then to the interest accrued

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