Blog
HOA Protected from Fraud and Embezzlement
Communities are assigned a board of directors to oversee the everyday operations, needs, and concerns of the community. However, this does not protect your community from fraudulent activity. The more informed you are about common HOA scams and fraud types, the more effectively you can take preventative measures to protect your HOA. Hoa Common is Fraud in HOAs? More than 40 million households belong to HOAs and HOA fraud costs the nation millions of dollars each year. HOA fraud is certainly not an uncommon occurrence since the community funds of these communities are often targeted. All in all, preventing HOA [...]
HOA Budget 9 Best Practices and Importance
One of the most important responsibilities of the homeowners association (HOA) board is to create a budget. A well-managed HOA budget can help you successfully maximize funds while also improving your residents' quality of life. It's challenging to plan an HOA budget, especially if you've never done it before. It's easy to lose track of the details when there are so many to consider. Here are HOA budget guidelines that can ensure a smooth preparation. How Important is an HOA Budget? What is the objective of a budget for HOAs? One of the most important best practices is to understand [...]
Does an HOA have to conduct a reserve study?
First off, let’s briefly uncover what a reserve study is and what it entails. It is merely a report that reflects the useful life each common area component has remaining. Also, the report assigns dollar amounts associated with each component. These amounts reflect the amount needed from each owner to replace each item when it’s life ends. This is a very common question and the short answer is YES! Per Civil Code §5550, an onsite reserve study must be conducted once every three years. The following link will lead you to the actual law and guidelines: Furthermore, this report shall [...]
Paying too much for your monthly HOA dues?
Paying too much for your monthly HOA dues? A lot of homeowners think that paying a high amount for their HOA dues is bad. However, it is better to pay a higher amount rather than have low reserve funds. Every HOA has a budget and a reserve study report. Those tools determine what the monthly HOA dues shall be. The board of directors shall exercise due diligence in setting the right amount. This amount shall be enough to cover monthly expenses, budgeted items as well as monthly reserve contribution. By doing so, the HOA will have a less likelihood [...]
What is considered common area?
In the property management world, common area is a widely talked about topic, especially in the HOA space. Within Homeowners Associations, a maintenance issue either falls under the umbrella of common area or the homeowner. Every HOA has a set of CC&Rs (Covenants, Conditions & Restrictions). Within this extensive document lies all the rules of the HOA. A section of the CC&Rs highlights the distinction of maintenance issues contrasting homeowner's responsibilities and common area issues. If an issue is within the common area then the HOA will be the responsible party to pay and rectify the matter. Although every [...]