Duty of HOA Boards to Collect Delinquent Assessments

HOA boards have a fiduciary duty to do what is in the best interest of their association, including everything that is reasonable to collect delinquent assessments. To carry out their duty, boards must establish a collection policy and then implement the policy pursuing those remedies permitted by law, including the recording of liens and foreclosing if necessary. Failure by the board to collect delinquent assessments will likely lead to higher assessments for those paying,larger special assessments, and the inability to borrow funds should the association want to do so. High delinquencies can also affect an association’s ability to qualify for FHA and Fannie Mae approvals which can adversely affect the ability of owners to sell or refinance their units. See: Pacific Association Collections.