Question
How can a home owner association raise money?
Our HOA is almost bankrupt and cannot afford to file liens on delinquent members' houses. Who can be contacted to help? We need to raise extra money so we can afford to put a lien on a house and collect fees. About 25% of the members do not pay and there are 75 houses in our neighborhood. The HOA only pays for insurance, street lights, night patrol (that does not come by hardly ever), and lawn care for just the surrounding area of the neighborhood. Also, our neighborhood has a "temporary" sewage pump station that was installed five years ago and is extremely expensive to maintain. The city stated to the developers that they may or may not take over the sewer system and there has not been a reply. The pump station is on its last limb and there is no money to fix it when it does break. Plus, the power company turned off the neighborhood lights because of insufficient funds. I am just a member and not on the board and just found out, today, that the association was so bad off. There has been absolutely no notification to anyone. Several members said that if they had known they would have paid the bills so the lights could have stayed on. However, one good thing that I have found in this situation is that we have a lot of active members that are willing to pull together to overcome these obstacles. We just need to know what to do exactly. I live in Alabama and this subdivision was built 5 years ago (I don't know all of the info that you need to answer my questions) Any ideas will be greatly appreciated.
4 weeks ago - 4 answers
Best Answer
Chosen by Asker
The first problem that you have to address is your current Board of Director (BoD) members. They are the ones responsible for the overall management of your HOA. They may have gone to sleep at the wheel or they may not have the expertise to properly manage or work themselves out of this problem. In any event, you must get them on board to either support from a distance or actively work towards resolving the issues. A good thing you have going for you is that you apparently have lots of “willing workers” to help on this problem. It may now be a matter of how to get them organized and identifying what they could be working on and how to go about it. I have led many organize wide efforts on very similar problems with excellent results. If you are looking for a cook-book recipe and a step-by-step of how to pull this thing off, go to www ... With this approach you will attack your revenue side as well cost side. This approach can be used for large associations or small ones. It will help you identify all forms of waste and opportunities that you may not have thought of. Generally, it will focus everyone on the following areas: 1.Arrear payment collection 2.Management Company Services (if any) 3.Administration 4.Utilities 5.Insurance 6.Purchased materials & services 7.Litigation 8.Preventative maintenance 9.Reserve funding 10.Taxes Your problem is not an easy one to fix and the solutions are likely to be painful. But, if you do nothing, your current problems will be pale in comparison to the ones that you will face, not too far in the future. Good luck JoeK
by Joseph K
4 weeks ago
Asker's Rating: 
Other Answers
First off, HOA's are mini Communist nations. Second, you raise money by raising your extortion ...uh I mean association fees.
by Ryan M- 4 weeks ago
Sell the sewage station to a third party, allow the buyer to make a decent profit, and then foreclose on the delinquent members. I know of a large gated custom home golf community that sold off their water-works supplier to a third party. I would also think that a foreclosure company would make some kind of deal to do all the foreclosures on credit and get paid either when the owners paid up or when the properties are sold in foreclosure.
by Glenn S- 4 weeks ago
I don't agree that HOA's are all bad, but they do need to be vigilant and good managers of the finances. Why has the board let it get to this critical situation? They should be held accountable for not being on top of the situation. You will probably have to levy a special assessment, unfortunately, on the honest members who pay their dues. If the master account has a regular audit, the problems should have surfaced before this. Why not go to one of the organizations which give advice and guidance to HOA's - here is one website: www ...
by CAtransplant- 4 weeks ago