HOAleader.com - Tip of the Week - June 12, 2020
Published: Fri, 06/12/20
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Condos/HOAs Not Experiencing Spike in Delinquencies--Yet
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In this week's tip, we check in with our experts around the country to find out whether the communities they represent are seeing increased delinquencies due to the millions of Americans thrown off the job due to COVID-19.
Their answer is so far, so good.
As of mid-May, our experts were saying that they had yet to see big changes in owners' assessment payments.
"We haven't seen an uptick yet, though I know many associations and their boards are worried about the impact of COVID-19," reports Janet Oulousian Aronson, a partner at Marcus Errico Emmer & Brooks in Braintree, Mass., who is licensed in that state, in addition to Rhode Island and New Hampshire. "I do expect that it's coming. But what we seem to be finding is that owners may not have paid April. April might have been the first month impacted by COVID-19.
"Most of the states I practice in didn't have stay-at-home home orders until the end of March," she recalls. "So for the most part, March was a normal month. The situation changed more in April, so I expect the first month we'll see some of these owners who've been affected will be April. And it's too soon for those accounts to be turned over to collections."
Aronson says the effect may have also been blunted because most of her clients and their professional managing agents have sent letters to owners requesting that owners reach out to the association if they have cash-flow challenges affecting assessment payments. "Many of my clients have been trying to inform owners that, if they have a problem, let's communicate and try to figure out a solution," she states.
A Florida community association manager also hasn't experienced an increase in delinquencies. "We haven't seen that yet," reports Bruce Masia, LCAM, the Broward County-based vice president of the southeast region for KW Property Management. "For March and April, haven't seen a major dip in payments. But let's be honest, I think there's going to be some hit.
"My clients are mostly newer, high-end developments," he explains. "For them, I think there's going to be a slight blip. But I don't think we're going to have the larger amounts of delinquencies you're going to see in some of the older properties."
Matthew A. Drewes, a shareholder at DeWitt in Minneapolis, hasn't seen an uptick in delinquencies either. "What I've dealt with is that, in my ongoing work on preexisting defaults, associations have seen little need to discontinue pursuing those because of the change in circumstances," he reports. "These are people who weren't paying already. I've also had some reports of board members who are deciding on their own that they're not going to put a matter into collection during the midst of directives to stay at home."
That's becoming more common, according to our experts. Also becoming more common? People trying to game the system. Read more in our new article:
https://www.hoaleader.com/members/4137.cfm
Best regards,
Matt Humphrey
President
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Should This HOA Board Be Handling This Owner in a New Way?
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Click here for more info:
https://www.hoaleader.com/products/effective-architectural-review-committee-a.cfm
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COVID-19: Which Condo/HOA Amenities and Recreational Facilities Can Open?
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Click here to read full article:
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