Tag: Important Posts

Having your vehicle towed can be a traumatizing experience.

Most condominium and homeowner associations utilize minimum parking. There’s always a time when someone in the community abuses parking privileges by parking in a prohibited zone or abandoning a vehicle for long periods of time. If the governing documents do not provide for the right to tow vehicles for illegal parking, then the rules and regulations (r&r’s) should suffice.

Step by step method to ensure r&r’s are added correctly:

• Post an agenda with the date, time and place of a Board of Directors Meeting.
• Make sure the agenda item states, “Board reserves the right to tow.”
• Vote to approve or disapprove towing.
• If approved by the Board, add the language to the governing Rule & Regulations.
• Send all record owners a copy of the new Rules & Regulations.
• An Affidavit confirming mailing is recommended.

After the “right to tow” is added to the r&r’s, it’s time to find a good local tow company.  The tow company should be exclusive and made available twenty four (24) hours a day. Ask for a free tow sign. Tow companies make money from towing vehicles from your community. Most south west Florida tow companies charge $180.00 to $220.00 per vehicle, depending if they use a flat bed truck or not. The sign is to be place in all entrances of the community. Any other tow sign placements would be additional. Your tow sigh should read, “Unauthorized vehicle will be towed at vehicle owner’s expense”, the bottom part of the tow sign should state the company’s name, street address with a operational phone number. Also Florida Statute 715.07 should be located of the sign.

Having a vehicle towed is very devastating to the unit owner and careful consideration should be considered before having a vehicle towed. We recommend a manager’s business card lightly tapped on the vehicle’s window. The notice should simply ask for the removal of the vehicle. To avoid more trouble than it’s worth, do not put heavy stickers on vehicles, this aggravates the owner unnecessarily. If the time comes where the violating vehicle must be remove, make sure a picture is taken of the vehicle before being towed. By doing this will alleviate any denial from the disgruntled vehicle owner of where the vehicle was taken from. Most tow companies have a digital camera ready for use.

For related posts see, “Condominium & Homeowner Associations Restricting Renters Rights” and “Responsibilities of Association Directors & Officers” and lastly but not directly related “Annual Proposed Budgets Almost to a Close”. If you are the select few who donate their time to serve on a board of your Association and/or a Florida Homeowner, you do not want to miss any new posts. Please subscribe to our community or our complimentary email services. (more…)

Ten (10) Reasons that make Property Managers go Hymn:

10. After-hour complaints regarding smoke detector beeping without any smoke. Property manager asks, “When was the last time you changed the batteries?”

9. Owner complains of neighbor’s cat peeing on shrubs causing them to wilt.

8. Lawn maintenance mows over and snaps sprinkler head in half. Lawn maintenance replace sprinkler head and charges association for irrigation repair.

7. Reports of a dead possum in the street.

6. Pool maintenance man tops-off pool with a garden hose. Pool maintenance man finishes and leaves job while forgetting to turn off water.

5. Plumber breaks building shut off valve using wrong pipe wrench. Plumber fixes building shut off valve and charges association for valve repair.

4. Homeowner fills elevator well with cat-litter because it smelled.

3. Owner (Snowbird) flies home for the summer, leaving an unknown leaky pipe. Owner returns to a mildew moldy mess. Owner demands association to pay for damages.

2. A punctured hole in the wall cause by moving furniture.  Owner demands association to pay for damages. 

And the number one (1) reason Property Managers  go Hymn:

1. Directors make error on amounts and quantity of building insurance. Directors sue the association for gross negligent.

Hymn

For popular posts see, “Property Insurance at a All Time High” and “Why Florida Condominium & Homeowners Live with Mold” and lastly “Condominium & Homeowners Rules for Parliamentary Procedures”. If you are the select few who donate their time to serve on a board of your Association and/or a Florida Homeowner, you do not want to miss any new posts. Please subscribe to our community. Or our complimentary email services.

We want to foreclose now, how long does it take?

If the lien was filed in a timely manner and there are no defenses raised by the unit owner, a textbook foreclosure could take as little as seven (7) months. Because of recent changes in the Florida Statute, fifteen (15) days longer for homeowner associations, see “Changes for Homeowners Associations”.

Three (3) Likely scenarios in most foreclosures:

1. Assessments fees, Attorney fees, late fees and all other cost associated with foreclosure are paid to the Association.
2. The Association takes title of property at the public foreclosure sale.
3. The defaulting owner files for bankruptcy.

The Association is legally entitled to collect all costs associated with forced foreclosure due to “failure to pay” assessments. Here’s a list of some possible charges; Claim of lien charge, clerk of court charge, filing a lawsuit, defendant fees, title search on the unit, delivering the complaint to the defendants, notice of sale costs, notice in local newspaper and clerks fee for the sale and documentary stamps for title.

The unit owner can pay at any time during these proceedings. The result turns into a “wash,” the Association is paid back assessments with all associated costs which terminates of the lawsuit.

The Association may choose to take title of the foreclosure property as an investment. In some cases where the equity of the property is not worth selling, the Association applies rent money to pay for back assessments until the property value increases. Once the property has gained in value, the Association would be able to successfully sell, recapping all connected costs.

A bankruptcy puts an automatic stop on first mortgages and also interrupts or imposes a federal “stay,” on association’s foreclosures. If the defaulting unit owner were a primary resident, then the owner would mostly be able to stay. However, the Association can still lien the property.

For sequenced posts see, “Part I; Collection Procedures for Condominium & Homeowner Associations” and “Part II; Collection Procedures for Condominium & Homeowners Associations” and lastly but not directly related “Directors & Officers is a Thankless Job”. If you are the select few who donate their time to serve on a board of your Association and/or a Florida Homeowner, you do not want to miss any new important posts. Please subscribe to our community. Or our complimentary email services.

Occasionally were asked if a unit owner is delinquent on assessments and their property is in a lien process, if the Board can revoke their voting rights, take away clubhouse and pool privileges and/or evict their renters. 

Since the condominium common-area is owned by the membership (see Condominium & Homeowner Associations Restricting Renters Rights), as long as there no “dual usage”, the owner is liven in the same community and is the legal owner of title, then nothing would prevent undivided common-area-use. Also, there is nothing written in the Florida Statute 718.106 regarding suspension of use rights or suspension of voting.

Homeowner associations on the other hand, are handle differently. Since common property is actually owned by the Board of Directors (see Condominium Verses Homeowner Associations), the Board has a little more common-area-use control. If provided for in the governing documents, and if the unit owner is delinquent, the Board can rescind the rights of common use. However, voting rights can never be annulled.

Additionally, both condominium and homeowner, the association has no rights regarding eviction due to late or delinquent assessments.

For similar posts see, “Condominium has Regulations, Where Homeowner Associations do not” and “Gulfshore Property Mgmt. Condominium & Homeowner Association Management” and lastly “Can a Unit Owner Assign His or Her Voting Rights?”. If you are the select few who donate their time to serve on a board of your Association and/or a Florida Homeowner, you do not want to miss any new important posts. Please subscribe to our community. Or our complimentary email services.

For supporting information, see Florida Statute 720.305 and 718.106 on next page:  (more…)

A new trend is out mollifying the high cost of association insurance.

After Hurricane Wilma, insurance rates soar to an all time high for community associations. Most existing local insurance companies packed up their bags and left “Dodge City”. This only left one company to carry the burden of insuring Florida associations with only the bare minimum. Citizens Insurance Company, which is a State funded company. After 2004 Citizen insurance more than doubled their rates for most South West Florida’s associations. The High cost of insurance directly affects all Florida homeowners.

There been ruses played by the Florida legislation using political tactics of conversions trying to stray Floridians away from demanding Charlie Crist to keep his promise of lowering Citizens insurance rates. See, “Property Insurance at a All Time High“.

Another feeble attempt by the Florida legislation to lower the ridiculously high price of homeowners insurance. In most classification codes, State has approved a workers compensation rate decrease, which is averaging slightly above 18%. Your association’s insurance agent would have to apply for the new workers compensation policy. Although it has happen before, it’s rare for an insurance agent offer rate decreases. As long as the association maintains a drug free work place and premiums are paid on time, your association should qualify. Again, this saving is peanuts compared to what we pay Citizen’s for Windstorm insurance.

While you have your association’s insurance agent check to see if your community qualifies for Workers Compensation deductions, have them check the new liability rates. General liability supposedly declining approximately 5 – 15%. This would depend on loss history and liability exposures of buildings. Still, the savings are no where near the doubling of insurance rates after 2004.

If your associations roofs hadn’t been checked by a Florida Contractor, might as well do it now. This is the only way Citizen’s give any kind of insurance relief. Beware of roofing mitigation contractors charging 10% of insurance savings. Paid them a flat fee instead. This will save the association money. The average refunds we experienced were 12 to 18% of  windstorm insurance premiums after factoring mitigation costs. Most associations qualify for these deductions. It’s rare for a roof not having proper straps and ties secured in place.

While the State of California is going bankrupt, the State of Florida is banking billions through Citizens Insurance Company. For relative posts see, “Property Insurance at a All Time High” and “Condominium has Regulations, Where Homeowner Associations do not. Regarding Notice of Meeting to Consider Excessive Budget” and lastly “Condomium & Homeowner Association Insurance Updates”. If you are the select few who donate their time to serve on a board of your Association and/or a Florida Homeowner, you do not want to miss any new important posts. Please subscribe to our community. Or our complimentary email services.

Part II; Collection Procedures:

Once collection is being turned over to legal council (the association’s attorney), all inquires are made to legal council only. To avoid a conflict of interest, the association or the manager should never discuss the defaulting property owner issue with any members. After being advised that a particular unit owner is delinquent of assessments, from that day forward, all collections are handled through the association attorney’s office and not through the association or management.

After the initial “demand letter” was sent with no response, the next step is to file a “claim of lien”. Claim of lien does not mean a lawsuit has been filed against the property owner. However, community associations must file for the claim of lien in public records, in the same place and in the same manner as a deed or mortgage, before filing a foreclosure lawsuit.

At the same time the claim of lien is being filed, a certified letter is sent to the unit owner advising the claim of lien has been recorded.The certified letter is the second thirty (30) day notice. The second thirty (30) day notice informs the unit owners that a foreclosure is in process. Also included in the notice is the amount due, including interest, late charges, attorney fees and any other reasonable costs. Without sending this statutory thirty (30) day second notice, condominium and cooperatives would lose their ability to incur a judgment for collection costs and attorney fees. Second thirty (30) day notice does not apply for Homeowner Associations.

There are many steps taken before a judgment can order the clerk of courts, sell the unit at a public auction. After the claim of lien is enforced, the competing interests are considered. Only two superior liens take precedence,  real estate tax and first mortgage, if any. If the lien process was executed in a timely manner, the better chance their isn’t any second mortgages, federal tax liens, construction liens or judgment liens, which would take a superior position in line.

The fewer the encumbrances, the more the property is worth and easier to sell. By naming the holders of competing interests as defendants in a foreclosure lawsuit and by proving the association’s claim of lien will be superior to these subordinate (secondary) interests, the buyer at the foreclosure auction will take title subject to real estate tax, first mortgage and extinguishes down by superior to subordinate interests. 

Determination the order of superior to subordinate competing interests, the attorney will file a foreclosure complaint. After the unit owner is property served and any other defendants, the case can move forward. Delivery of the foreclosure complaint is called, “Service of Process”. The service of process is executed in a formal manner and has many restrictions.

If no technicalities arise and after the judge enters the judgment, a foreclosure sale is set. Twenty (20) to thirty five (35) days later, the foreclosure sale should be final, resulting in the association being reimbursed for all associated costs. Of course, the association could elect to buy the property. Or the defaulting owner owes more than the property’s worth. Before any business decisions are entertained, the association should always consult with their attorney. 

For relative posts see, “Developers are in Business too Make Money” and “Fining Procedures for Homeowners Associations” and lastly “Condominium & Homeowners Rules for Parliamentary Procedures”. If you are the select few who donate their time to serve your Association and/or a Florida Homeowner, you do not want to miss any new posts. Please subscribe to our community. Or our complimentary email services.

Part I; Collection Procedures: 

Collection of quarterly assessments is the lifeline utility of community associations. Without the collection of association dues, the budgetary commitment of the association could not be met. The services, maintenance and the preservation of the association are dependent of association dues. Since some community association disputes are over quarterly assessments, consistent operational procedures should be in place, so automatic collections can be conduced without prejudices. 

The rights to collect quarterly assessments are outlined in the community documents and Florida Statutes. These documents also give Board’s authority to prepare an income and expenses annual budget with a reserve schedule.  If the Board does not follow collection procedures described in the governing documents, there may be counter claims, which can cause unnecessary costs to the association. By following these documents, the Board can rightfully collect dues without dispute or recourse.

Condominium documents regarding, “Failure to Pay” are mostly standard. Below is an example of Condominium Declaration of Covenants, Application of Payments; Failure to Pay; Interest:

Assessments and installments thereon paid on or before ten (10) days after the date due shall not bear interest, but all sums not so paid shall bear interest at the highest rate allowed by law, calculated from the date due until paid. The Association may also impose a late payment fee (in addition to interest). Assessments and installments thereon shall become due, and the Unit Owner shall become liable for said assessments or installments, on the date established in the Bylaws or otherwise set by the Board of Directors for payment. All payments on account shall be applied to interest, late payment fees, court costs and attorney’s fees, and delinquent assessments. The Association may refuse to accept a partial payment, which bears a restrictive endorsement, and such will be the equivalent of no payment. No payment by check deemed received until the check has cleared.

Every association should establish and follow uniform collection procedures. The collection should have the same procedures for all members, directors and officers equally.

For example, the association might prepare a “reminder” letter. Customarily, a ten (10) or fifteen (15) day past due “reminder” notice. Anytime after late fees are added, the Association is entitled to begin lien processing. To avoid being last in line of competing interests (encumbrances), the account should be turned over to legal counsel no later than thirty (30) days of delinquency. Once the account is turned over, a “demand letter” will give owner thirty (30) days to pay in full, including interest, late fees and attorney costs. If the defaulting owner does not pay in full within the thirty (30) days, “the claim of lien” process begins. For Homeowner associations, a forty five (45) day demand notice is required before a claim of lien can be filed. Usually after this point, the owner pays in full and the remaining interest, late fees and dues are collected and returned to the association.

Condominium owners beware; if any assessments become delinquent, in most Condominium and Cooperative documents have an “acceleration clause”. This means, if a claim of lien is recorded in public records, then the association has the right to collect all assessments for the entire fiscal year. See sample Condominium Declaration of Covenants, Acceleration:

If any special assessment or installment of a regular assessment as to a Unit becomes more than thirty (30) days past due, and a Claim of Lien is recorded, the Association shall have the right to accelerate the due date of the entire unpaid balance of the Unit’s assessments for that fiscal year. The due date for all accelerated amounts shall be the date the Claim of Lien was recorded in the public records. The Association’s Claim of Lien shall secure payment of the entire accelerated obligation, together with interest on the entire balance, attorney’s fees and costs as provided by law; and said Claim of Lien shall not be satisfied or released until all sums secured by it have been paid. The right to accelerate shall be exercised by sending to the delinquent Owner a notice of the exercise, which notice shall be sent by certified or registered mail to the Owner’s last known address, and shall be deemed given upon mailing of the notice, postpaid. The notice may be given as part of the notice of intent to foreclose.

For relative posts see, “Changes for Homeowner’s Association” and “The Florida Regulatory Council of Community Association Managers Changed the Florida Statutes Again.” and lastly “Responsibilities of Association Directors & Officers“. If you are the select few who donate their time to serve on a board of your Association and/or a Florida Homeowner, you do not want to miss any new important posts. Please subscribe to our community. Or our complimentary email services.