A homeowners’ association (HOA) management company is responsible for managing the day-to-day operations of an association. Volunteer board members have jobs and obligations and often lack the time and expertise to self-manage the HOA. The board of directors makes the decisions, then tasks a management company to implement their vision.
Homeowners and board members should fully understand the HOA management company’s responsibilities. Confusion can cause certain obligations to slip through the cracks or prompt redundancies. Frustrated, dissatisfied homeowners could be left wondering who they are supposed to approach with problems or questions.
HOAs have unique needs based on their size, location, and the organizational structure created by their governing documents. Because of this diversity, HOA management is not a one-size-fits-all arrangement.
Despite this, there are certain administrative functions vital to most businesses. Let’s look at the
top responsibilities of an HOA management company.
Billing and Collections
HOA management companies need to be consistent with billing and maintain an aggressive collections policy. Assessments are the bedrock of a community association’s financial stability.
Association management companies spearhead the following tasks related to homeowner dues, fines, and fees collections:
- Billing residents, often monthly
- Dispatching delinquency notices to residents behind on payments
- Keeping the board apprised of the status of problem accounts
- Escalating delinquent accounts to collections
- Coordinating with the HOA’s collection attorney to initiate legal actions to collect every overdue assessment
- Staying current on, and abiding by, collections-related state laws
An HOA management company is responsible for maintaining property values by fairly enforcing community-enacted rules. To carry out this duty, the management company must:
- Regularly visit the community to spot violations
- Send violation notices to residents not in compliance
- Function as the contact person for residents with questions or reporting a violation
- Follow up with homeowners who were served notices to rectify their violations
- Conduct on-site violation inspections to confirm compliance
To maintain and improve the community’s condition, an HOA management company is responsible for:
- Hiring and paying for lawn care, pool maintenance, and snow removal vendors
- Observe the community’s overall condition to verify contracted services are being provided
- Ensure common areas are well maintained and accessible to residents
- Field maintenance requests from residents and board members
Preparing financial records, creating reports, and performing general accounting tasks can be complicated, even for smaller HOAs. However, professional HOA management companies should be proficient at:
- Managing and reconciling bank accounts and ledgers
- Preparing timely and accurate accounting reports
- Distributing financial reports to the community’s board of directors and homeowners
- Advising the board during the budget formation
- Setting up and monitoring reserve accounts for future projects and to cover unforeseen losses
In each of these areas, the HOA management company functions as an agent of the HOA board. The company is the homeowner’s primary contact for HOA issues; therefore, accuracy, efficiency, and effective communication are paramount for a successful partnership.
CINC Systems’ multi-faceted association management software provides automated reporting, a cloud-based platform, automatic daily account reconciliation, and customized web portals to help association management companies smoothly manage their HOAs for maximum profitability.