Does An HOA Need A Management Company?
Homeowner associations (HOAs) are complex organizations. Comprised of multiple homeowners and governed by an elected board, HOAs can have a wide range of different needs. Ensuring the success of an HOA requires lots of time, hard work, and dedication.
Since board members usually have full-time jobs outside of the HOA, the best solution for running an HOA is to hire an outside management company. That’s where you come in.
As you build a successful HOA management company, some potential clients may wonder if they need your services. In most cases, the answer is yes. HOAs need a management company to help them operate. Whether big or small, there are several reasons why an HOA needs an association manager to help their community. With your knowledge and experience, you can ensure that your HOA clients establish and maintain a thriving association that benefits all members.
Every HOA is unique, with different goals and challenges. However, all HOAs share certain organizational structures, legal requirements, and financial needs. By understanding this, you can tailor your association management business to any client.
Here are several common reasons why an HOA needs a management company:
1. Manage Daily Tasks and Big Projects
Most HOAs need a manager to help with daily tasks. This includes mundane yet important duties such as collecting the HOA’s mail, inspecting the grounds, and acting as an accountant. As an association manager, it’s part of your job to look after your clients’ budgets. Using software like CINC Systems for general ledger accounting and automatic bank reconciliation, you can monitor your clients’ bank accounts in real-time and protect the HOA from fraud.
Additionally, an HOA needs a management company to help facilitate big projects. Whether it’s an upgrade to common areas, a new construction project, or other long-term endeavors, an HOA manager can help their clients plan for the future. This includes acting as a consultant and offering advice to the board, as well as executing project plans.
2. Enforce the HOA Rules
HOA management companies are also necessary to help an association enforce their rules. To help your clients make sure that their communities remain desirable places to live, you can do two things.
First, make residents aware of the HOA’s bylaws and rules. Legally, the HOA must provide each homeowner with a copy of its rules by distributing a governing document known as the Declaration of Covenants, Conditions, and Restrictions (CC&R). This is given to each new homeowner when they purchase their property.
However, some residents may not read the rules very carefully or forget them over time and lose their copy of the CC&R. By using your association management software to create a resident portal with a digital copy of the CC&R, you can ensure that everyone in the HOA understands the rules.
Second, you can help your HOA clients enforce the rules by handling violations on the association’s behalf. Depending on the nature of the violation, you may choose to issue a verbal warning, followed by a written warning, and then impose fines or restrict privileges.
3. Ensure Legal Compliance
HOAs are legal entities that are required to comply with various local laws and civic codes. These legal requirements can be long, complex, and change over time, so the HOA’s board members need help ensuring compliance. As an association manager, you can assist with this.
As you begin working with a new client, make sure they have the necessary HOA governing documents such as articles of incorporation, association board bylaws, and the CC&R mentioned above.
Then, review the HOA’s various permits and licenses. Make sure everything in the HOA is up to the current code. If there are areas where the association is in violation, such as a structure built without the correct permits, help your clients work with their city or county to comply.
4. Collect Resident Fees
Next, an HOA needs a management company to help collect resident fees. Resident fees are crucial to the operations of an HOA. Fees cover maintenance and repairs for common areas, monthly bills, the association’s reserve fund, and more.
In the past, collecting resident fees was arduous and time-consuming. However, with cloud-based association management software like CINC Systems, this task becomes easy. Association managers can use CINC Systems to create an online payment portal for their clients’ residents. This gives residents the ability to pay electronically.
Then, fees are automatically deposited into the HOA’s funds. Association management software like CINC Systems also lets managers easily generate a list of overdue or incomplete payments. To see how CINC Systems can help your association management company collect resident fees, call (855) 943-8246 today to request a free demo.
5. Hire Vendors and Pay Bills
Associations need outside vendors. Whether it’s a one-time repair or ongoing services such as security and landscaping, HOAs need professionals to help maintain their community. As the association manager, it’s your job to vet new vendors for your clients. If your clients have existing contracts, you can also take responsibility for reviewing their work and making changes if the vendor’s service isn’t adequate.
In addition to hiring vendors, an HOA needs a management company to help them pay the bills. Association managers help the HOA stay fiscally organized using software like CINC Systems. Association management accounting software allows vendors to submit invoices electronically. Then, the HOA manager can easily pay the outstanding amount from the HOA’s funds.
6. Handle Resident Communications
Finally, an HOA needs a management company to help handle resident communications. This includes making announcements about fees, board meetings, new or updated rules, and other information that affects your client’s community.
HOA managers also assist their clients by communicating with individual residents about specific issues. This could include mediating a dispute between neighbors or keeping a resident updated about the status of a work order. When an HOA has a big community with dozens of families, they’ll need a management company to help them stay on top of communications.
Related Frequently Asked Questions
- How Can Association Management Companies Working with HOA/COAs Benefit from Association Management Software?
- Top 10 Tips When Managing HOA Accounts
- How Association Managers Benefit from CINC’s Accounting Software
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- Is My Association Management Accounting Data Safe When Using Software Tools?