Charging late fees

Denise,

Yes,IMO, they can be interepreted differently; they can be interpreted correctly!! The bylaws are very explicit in saying the late charge is $15 per month. That particular member was grossly overcharged. I sure hope they complained!! If a member is one year delinquent, the late fees would amount to $165 - 11 mos late x $15 per m $165. If the treas who charged $45 and $60 per month is still the treas, she needs to be removed as treasurer IMMEDIATELY. After noticing this gross miscalculation, I would be calling for an audit of the members' accounts. Anyone overcharged needs to be reimbursed immediately.

Thanks Mary,

I was wondering who should pay for the audit? Could we bill the Treasurer? Obviously this HOA stuff is new to me.

Denise

Denise,

Actually it wouldn't have to be a CPA conducted audit. Anyone with some bookkeeping experience could do it. The treasurer could do it; that is if it isn't the same one! LOL I guess you could call her method "creative accounting". And, I honestly don't know how she came up with $2,000 for one year.

this is the current late fee rule. no amendment.

If you were late one month, you were charged $15. If you still did not pay the next month, you were charged $30. If you did not pay the third month, you were charged $45. The treasurer kept on adding $15 to the previous late fee. There were months a member was charged $185 in late fees only. The sad part is she still lives here and doesn't realize what she has done wrong.

Denise,

And that does NOT add up to $2,000 for one year! As Forrest Gump would say, "Stupid is as stupid does". I wonder where the BOD's collective heads were. Weren't they looking at the delinquencies and late fees each month? It doesn't take a rocket scientist to see that something was grossly amiss. Didn't any of the delinquent members complain? What happened when this was finally uncovered? I'm sorry, but this really bothers me. :-(

Steve, the LATE fees and the actual DUES AMOUNT are included in your total.

The treasurer here is COMPOUNDING the late fees.

This is what she is doing:

$100 Jan
$15 late fee

$100 Feb
$30 late fee

$100 Mar
$45 late fee

So after three months the person has been charged:

$300 in dues and $90 in late fees

as opposed to

$300 in dues and $45 in late fees.

Steve, you are still doing this the "normal," cummulative way, not the compounded way that the OP's treasurer is doing it.

Your way is the correct way.

At the end of 4 months, under the way most of us calculate this, they would owe $400 in dues and $60 in late fees.

However, in the way this other person is calculating, the late fees would total $150.

But look at it this way.........in this bad economy the association would be making so much money in late fees that they could either build a pool or lower the common fees what with all the extra income. The board would look like heroes. That is.............. until the audit came.

Bottom line no matter how you look at this it does not add up even with the 6% added in. Late fees are per month according to these docs. The maximum of late fees should be $15 x 12 for a full fiscal year of non - payment.

She said "$45 per month if she was 3 months late" It seems to be the same math. She is charging:

$15 late fee in Mar for no Jan dues paid
$15 late fee in Mar for no Feb dues paid
$15 late fee in Mar for no Mar dues paid
------------------------------------
Total = $45 (late fees just for March)

The entire text:
"assessments which are not paid when due shall be delinquent. If the assessment is not paid within 30 days of delinquency, interest may be charged at the rate of 6% per annum, and the Association may assess a $15.00 per month late charge."

I would think a judge would have to rule on this one. It could be interpreted either way. The condo association might have some other back up documents relating to why they charge $15 per month, every month.

Not unless the documents say otherwise.

Steve,

I beg to differ. There's only one way to interpret what "per month" means. It means "for each month". In other words, each month's assessment. The assessment amount does not change each month only the delinquent assessment amount changes. If the assessments are late in Jan, $15 is tacked onto the account. If they are late in Mar, a $15 late fee for that month is tacked on, and so on and so on.

I had the impression this occured in the past. Of course I may be wrong; perhaps the same treasurer is charging the fee this way and the BOD has no objection to it. If that's the case, it appears none of them have any common sense!

Old thread. Best to start a new one.
Take a look at applicable statutes - they may provide for late charges.