Tag Archives: Assessments

Identical Square Footage But Higher Monthly Condo Common Fees

K.G. from Michigan writes:

Dear Mister Condo,

I recently found out that a same size condo as mine is being charged less per month in monthly fees. HOA indicated they charge by the square footage which are on the original plans. I reviewed the plans and the square footage is the same. I have requested in writing, why I am paying a higher price. HOA has not responded. I don’t know where to go from here. Thank you.

Mister Condo replies:

K.G., while square footage is often taken into consideration when determining common fee schedules, it is not necessarily the only factor. When the common fee schedule was created by the developer, other factors such as view, preferred location within the community, end-unit, first-floor unit, and many other items may have been taken into consideration. Whatever the reason, a common fee schedule was developed and a fee percentage was assigned to each unit. Those fees are the gospel of how expenses are divvied up within the association and each unit has an obligation to pay their fees based on that schedule. To simply state that square footage is the only determining factor when common fees were adopted is very unlikely true. You should review the condo governing documents to review how the fees are determined. You will likely find out that your unit was assigned a higher percentage than your similarly sized neighbor’s unit. Perhaps your unit is on a higher floor or has a better view? Whatever the reason, unless you find that you have been charged incorrectly, the common fee schedule stands. All the best!

How Many Month’s Common Fees Can Be Collected in Foreclosure?

B.O. from Fairfield County writes:

Dear Mister Condo,

What is the maximum months of common fees an association can collect in a bank foreclosure? What is the maximum an association can collect when they foreclose?

Mister Condo replies:

B.O., the answer is not as clear as you might expect. The actions taken by the association in advance of the foreclosure can have an effect on the outcome. For that reason alone, many associations turn to either a collections expert or an attorney for assistance in collecting as much as they possibly can. The other variable is the ability of the owner being foreclosed upon to pay. If they file a bankruptcy at the right time, the debt to the association may also be included in the discharge of debt, leaving the association with a claim for which they cannot collect. In Connecticut, there are various liens and lien procedure that seem to have the best yield. There is an evergreen lien that, in theory, ensures the association will collect ALL of the past due fees when the unit is finally sold or auctioned off at foreclosure. This type of lien is filed repeatedly until the unit is liquidated. A more common lien is a 6-month lien. Filed once, the association collects up to 6 months of owed fees and reasonable collection costs. This is quite common when a mortgage holder is involved in initiating the foreclosure action and the association “goes along” with the bank. The bottom line is that banks typically initiate foreclosure far more often than associations do. However, that is not always the case and in a soft real estate market, the bank has little incentive to take over the unit (and the common fee payments and liability of owning the unit) and the association needs to think creatively before foreclosing and finding there is little or no money left for them when the foreclosure is over. I think the best policy is to work with a collection professional or association attorney to make sure the association is doing all that it can to protect itself from the loss of income. The good news is that the vast majority of unit owners pay their fees on time and that the drastic measure of foreclosure only surfaces when all else has failed. All the best!

Condo Owner Excused from Paying Special Assessment

M.A. from outside of Connecticut writes:

Dear Mister Condo,

When is an owner excused from paying their share of a special assessment?

Mister Condo replies:

M.A., as far as I know, an owner is NEVER excused from paying a Special Assessment once it is levied by the Board. The whole point of a Special Assessment is to collect monies needed by the association from ALL of the association members. As an example, think of a 100-unit association where every unit is assessed 1% as their percentage of unit ownership. If the Board needed to levy an assessment of $100,000 to pay for parking lot repairs, the Special Assessment would equate to all unit owners paying $1000. If the Board were to excuse one or more owners from paying their share of the Special Assessment, they would come up short of the $100,000 needed to repair the parking lot. And what about all of the unit owners who did pay their share of the Special Assessment? I know I wouldn’t be too happy to learn that one of my fellow unit owners didn’t have to pay. In fact, I would sue the association for making an improper assessment. Unless your governing documents specify a situation where a unit owner is excused from paying a Special Assessment (I have never heard of one), there is no excusing of payment of a Special Assessment. All the best!

HOA Turns Off Water on 5-Day Delinquent Owner

B.A. from outside of Connecticut writes:

Dear Mister Condo,

I’m wondering if our Property Management really has a right to authorize disconnection of water in my unit due to unpaid HOA dues (only 5 days overdue to be exact) even if I don’t have an outstanding balance from my water provider. I can say that this is the first time that my HOA dues was paid late because I’ve been paying my dues always 1 year in advance. Hoping for your advice. Thanks

Mister Condo replies:

B.A., I am sorry that your HOA took such a drastic measure as turning off your access to water after you were only 5 days overdue with your payment after having a great track record for so many years. The reality is that every association has its own policies for such things and it would appear that yours is quite strict. As to whether or not they had the right to do so is a legal question best posed to an attorney in your area. My guess is that they tool lawful action and that you aren’t the only unit owner who has had this happen. You can always make a quick call to an attorney to confirm if your rights were abused. Other than that, my advice is to set up auto-payment or prepay as you have done in the past. Common fees are the lifeblood of any association. The association is right to do all that they can to assure they are paid in timely fashion by all unit owners. All the best!

Condo Unit Owner Claims Negligence as Reason for Not Paying Assessment

V.M. from Middlesex County writes:

Dear Mister Condo,

If I do not pay an assessment because of negligence by the trustees do I lose my rights as a unit owner?

Mister Condo replies:

V.M., regardless of what the reason for not paying an assessment, the association will very likely take collections action against you, up to and including foreclosing on your home. You do not fight a claim of negligence by withholding fees or assessments because the association has a legal duty to collect those funds from you and from all unit owners. You have rights as well and challenging the Board with a claim of negligence is done with a lawsuit initiated by you against the association. The only thing withholding fees or assessments will accomplish is legal fees and possible loss of your condo through foreclosure. That is not a good strategy, in my opinion. All the best!

Lack of Maintenance by Self-Run Condo Board

D.T. from New Haven County writes:

Dear Mister Condo,

The self-run condo board is not taking care of the maintenance of our complex. Shingle, roof, painting and paving have not been addressed in years. We pay on an average of 350.00 a month in HOA fees. What recourse do the owners have to get action and for the board to be held accountable to provide proper upkeep for our complex? Is there a state board that we can contact that can help us?

Mister Condo replies:

D.T., I am sorry that you find yourself at odds with your Board over care and maintenance of your complex. I wish I could say that you were alone in your dissatisfaction but the truth is that many associations simply haven’t saved enough money over the years to appropriately maintain their properties. This leads to the unpopular Special Assessment and the equally unpopular increase to common fees. In your case, $350 per month should likely be adjusted to $450 per month or higher. That way, the current expenses of the association could be paid and a healthy contribution to the Reserve Fund for future repairs could be established. As for the immediate needs of the association, a loan or Special Assessment is very likely needed. From the brief list you have provided, I wouldn’t be surprised if $10,000 or more per unit would be needed. If unit owners can’t afford that kind of one-time payment, then a loan (which will also increase common fees and have the additional expense of interest) is in order. The bottom line is that Boards of Directors turn over in condo associations over time. Each new Board inherits the good or bad practices of the previous Board. In associations that require maintenance on 20 to 30 year-old buildings, that means either having the money to do the projects from the great fiscal planning of previous Boards or picking up the pieces from poorly thought out Reserve Fund planning. Guess which kind of association you live in? The bottom line is that it takes money to perform the needed maintenance and that money only comes from one place – the owners. It sounds to me like it is time for your association to pay the piper. Of course, all of the unit owners have a say in raising common fees and Special Assessments. Neither are popular and both have real consequences to owners, including forcing out the folks who can’t pay up. However Darwinian as this sounds, it is the way of the world. I wish you and your community good luck in solving this difficult problem.

Question of Financial Liability for Condo Decks Leads to Foreclosure!

D.U. from New London County writes:

Dear Mister Condo,

I own a condo in a building without deck units, whereas other buildings in the condo have decks attached to their units. Since a deck or balcony is not a common element, I feel that it is not fair to be asked to pay $2,000.00 for the repairs of other units’ decks. Plus, I was appalled to learn at one of the meetings that some decks were repaired not long ago but the shabby job done made them fall apart in the following year. The Board of Directors members, who, by the way, have decks to their units, were quiet about it at the meeting. The association should be held accountable for not preventing such a failure. Instead they are imposing a lot of money to cover their mismanagement on many other units without a deck. Many of owners are elderly, as myself, living on a limited income. To involve a lawyer to fight such an abusive manner in the court, cost a lot of money which we cannot afford. As a matter of fact, I have already got a letter from the association, to be informed that a lawsuit including a foreclosure is intended on me. I have to add the association couldn’t provide, at my lawyer request, a copy of the relevant portions of the By-Laws, Rules, or Regulations which authorize the imposition of such assessment on me. Where should I address this issue other than here? I think that an investigation is overdue on Property Management at my association.

Mister Condo replies:

D.U., I am sorry you find yourself at such odds with your association. To hear that you are being threatened with foreclosure now tells me things have progressed even further than your letter lets on. Let’s start with what comes next so that you don’t lose your home. You have hired an attorney to represent you and that is critical to protect your rights. He has asked for the supporting documentation giving them the right to assess and then foreclose for failure to pay the assessment in timely fashion. I can assure you that they do have the right to collect assessments from you and they can foreclose against you if you don’t pay the assessments. You also have rights and you may be able to sue them if the assessment was passed incorrectly or if the decks are not common elements, as you claim. Unfortunately, my guess is that the decks are considered common or limited common elements and that you may, in fact, be liable even though your unit does not have a deck. I realize that this seems unfair but unless you or your lawyer can show where they have done something wrong, the assessment will stand and you will be held liable. There is no central authority in our state to investigate the management of your association and I am not an attorney and offer no legal advice here. You have already hired an attorney which is your best option to see this through. I wish I had better news for you here but I think the only real problem here is an understanding of how a condominium association operates and governs itself. Hopefully, your attorney will help you navigate this legal turmoil. All the best!

Previous Condo Owner May Have Failed to Disclose Upcoming Special Assessment

C.P. from Middlesex County writes:

Dear Mister Condo,

My daughter bought a condo where her association fees are $450.00 per month. Due to future major roof improvement job her payment will increase by $300.00. We feel the seller had to know about this upcoming project and didn’t reveal this very crucial information. The other choice to pay would be a one-time payment for $22,000.00 per unit. There are 40 units. Something doesn’t seem legal here. Your thoughts.

Mister Condo replies:

C.P., I am sorry for your daughter’s predicament. It is quite possible that the previous owner was aware that there was a possibility of a Special Assessment but unless the Special Assessment had already been passed and levied against the unit owners of record, it is unlikely that they did anything illegal. In fact, the knowledge that this Special Assessment was looming may have been a very important factor in his/her decision to sell. You can and should speak to an attorney to make sure the seller had already been informed of the assessment and failed to provide that information. If they signed a disclosure statement where they lied about the Special Assessment, you may very well have a case. All the best!

Condo Maintenance Fees on Condemned Building

J.B. from Hartford County writes:

Dear Mister Condo,

Can an association charge maintenance fees for a condemned building that has legally been condemned by the city of Hartford because of a fire that caused structural damage?

Mister Condo replies:

J.B., condemnation does not prevent common fees from being charged and collected. Condemnation simply means the building has been deemed unsafe and uninhabitable. The building and the association are still incurring other expenses that are part of the maintenance fees and all unit owners are still beholden to their covenants to pay those fees. I know it seems to fly in the face of reason that maintenance fees are collected on a condemned property but unless the association is dissolved (unlikely), the common fees continue to accrue and the association is entitled to collect. I hope they get the building repaired or rebuilt in timely fashion for you and other unit owners. Good luck!

Proper Condo Owner Notification for Passing Special Assessment

K.G. from Fairfield County writes:

Dear Mister Condo,

in Connecticut, if an association Annual Meeting is held and a Special Assessment is being brought before unit owners to be voted on, does the specific amount need to be disclosed in the notice to unit owners? Our agenda said “discussion of” the project … should it have said “vote on special assessment” for the project? Question 2 – What if the board agreed to a dollar amount to bring before the association for vote and at the association meeting it was increased and voted in favor by the unit owners.

Mister Condo replies:

K.G., as long as the Meeting was properly noticed and the Special Assessment discussion was on the agenda, it is unlikely that the Board did anything wrong with regards to notice. Ditto to the actual amount of the Assessment after the Meeting was held. That being said, your association’s governance documents may provide for a special procedure for levying Special Assessments and that protocol would have needed to be followed. There may also be a limit on the percentage or size of the Special Assessments. At the end of the day, if the association is short of money needed for repairs and maintenance, the details of how the Special Assessment is issued is secondary to the problem that enough money was not collected by the association to pay for the repairs that are now needed. Special Assessments are patently unfair but necessary when needed. The sweetness of low common fees is soured when the money is needed for the repairs. I hope your association gets through this turmoil and gets itself back on track financially in the near future. It is quite possible that common fees need to be raised substantially to make that happen. That won’t be very popular amongst owners but it will avoid these Special Assessments in the future. All the best!