There are many facets involved with managing a homeowners association - finances, collections, insurance, maintenance, rule enforcement, record keeping, and the list goes on.
For larger associations, this usually means enlisting the help of a management firm or a property manager to take care of these tasks.
Many associations do not need a full service management company, or perhaps don't have the budget to afford one. These could be smaller condominium developments or single family HOA subdivisions with limited maintenance requirements.
There are few options for smaller associations:
Remote HOA Management for Small HOAs
Numerus provides remote HOA management remote HOA management that is designed with smaller associations in mind. Numerus provides a majority of the services of a local HOA management company at a fraction of the cost.
In summary, Numerus handles all of the "paper work" and administrative duties of the association:
- Collection of HOA dues with multiple payment options (check, e-check / ACH, debit and credit card)
- Delinquency reminders
- Paying bills
- Sending out community notices
- Preparing the budget
- Assisting with tax preparation
- Sending 1099s to vendors and contractors
- Processing estoppels / resale certificates
- Online portals for homeowners and board members
- Consulting and advising the board on important issues
There are some responsibilities that are left up to the board. It's important to note that not all management companies provide all of these services. Be sure to speak with them in detail so you have a better understanding of what is provided, what's included with your base fee, and what costs extra!
- Soliciting RFPs
- Filing insurance claims
- Running community meetings
- Onsite property inspections
- Emergency maintenance response
If your HOA board is comfortable with handling these responsibilities, but does not want the financial liability of managing the association's funds, then Numerus is a great option!
Using a Local CPA / Bookkeeper for the HOA
Hiring a local bookkeeper may be an option for the HOA. It's important to note that not all bookkeepers provide the same level of service. In general, a bookkeeper will prepare monthly financial statements, help prepare the budget, and file the tax returns.
However, when it comes to the task of collecting HOA assessments and paying bills, this will most likely be the responsibility of the board. It's important to note that most bookkeepers usually work with local businesses. The business owner handles collecting payments from their clients and paying their bills, and gives receipts to the bookkeeper for recording the transactions on the books and reconciling the bank statements each month. In the same manner, the board will be responsible for collecting the dues from the homeowners and keeping up with who paid, when they paid, and how they paid.
When it comes to paying bills for the HOA, there are two common methods:
- Bookkeeper prints checks, and the board signs them
- Board pays the bills and gives the invoice / receipt to the bookkeeper
Either way, this means the board must take time to sign the checks OR remember to pay the bill and report it to the bookkeeper.
When using a local bookkeeper for your HOA, remember to speak with them about their services so that you can properly set the expectations and understand what you are getting for the money.
Self Managed
If the board opts to fully self manage without any assistance, then all responsibility falls on the board. There will need to be some decisions to make.
- Accounting System - What will you use? Who will manage it? How much will it cost?
- Banking - signing checks and being responsible for the association's bank accounts
- Sending out notices - some letters are required to be sent by postal mail by law. Who's going to print them, stuff the envelopes, and put a stamp on it?
- Collecting HOA assessments - how will it be setup? Who will collect it? Will the homeowners deliver the payments in person? Will they mail it to a PO box?
This will always be the cheapest option of the three, but the board is fully responsible for everything and assumes all liability.
Summary
All three options have their pros and cons. It's important to consider each one carefully and make sure the board is making the right decision when it comes to managing your HOA.
Numerus provides a good "middle of the road" approach when it comes to hiring a management company for a smaller association and will be much more affordable compared to a local management company. If you have questions or would like more information,
contact us today!