What Not to Do When Collecting Past Due HOA Fees

couple looking at bills

Homeowner associations rely on fees for their day-to-day operations. If even just a few homeowners fall behind on their payments, the impact on the association’s budget can be huge. Fees that are left unpaid may also lead to a ripple effect. Banks are less likely to approve mortgages in associations where fees are frequently unpaid, and when potential buyers are unable to secure funding, the value of the homes in the neighborhood can fall.

In most instances, it’s best to work directly with homeowners when attempting to collect unpaid fees. Remember that we all face unexpected situations and emergencies and that many homeowners who fall behind don’t do so intentionally. When people in your association are struggling to pay fees, they need to know that you’ll work with them and adhere to the standards set forth by the Fair Debt Collections Practices Act, or FDCPA.

Here are a few things not to do when collecting past due HOA fees.

What Not to Do When Collecting Past Due HOA Fees

Homeowners association fees and assessments are viewed as debts by many state and federal courts. As such, they must be collected by homeowner associations according to the regulations set forth by the FDCPA. Debts must be collected in a manner that is not considered invasive.

According to the Fair Debt Collections Practices Act, you may not:

  • Harass homeowners
  • Threaten homeowners with any type of violence or physical harm
  • Publish the names of homeowners who refuse to pay or have fallen behind on their fees
  • Annoy homeowners with repeated or frequent phone calls
  • Deposit a post-dated check early
  • Misrepresent the amount the homeowner owes
  • Share any personal information without the homeowner’s permission

You are required to notify homeowners of delinquent fees in writing, and the document must say that it is an attempt to collect a debt. The letter must also include the association’s name and how much is owed, and it must state that the homeowner has 30 days to dispute the debt.

If you violate any of these regulations when attempting to collect a debt, you could be liable to the homeowner for damages, court costs and attorney fees.

Having Trouble Collecting HOA Fees?

If you’re having trouble collecting HOA fees, a professional property management company can help. At AMI, we offer a full range of financial management services, and we can help you handle the tricky tasks like collecting past due fees. Contact us today to learn more.