Statute of Limitations on Past Due Common Fees?

Re post from Ask Mr. Condo 

E.H. from Middlesex County writes:

Dear Mister Condo,

Is the common charges fee assessed against the Unit or the Owner of the Unit? What is the Statue of Limitations for past due fees?

Mister Condo replies:

E.H., for the most part, common fees and special assessments are placed upon the owner of record of the unit at the time the fees are assessed. There may be exceptions during the developer controlled phase of a new development but, in most instances, fees are assessed to the unit owner of record and I am not aware of any statute of limitations for past due fees, provided the unit owner was served proper notice under the rules of the association. Association will generally put unit owners with severe delinquencies into the hands of a collections specialist or an attorney. In the most severe cases, the association can even bring a foreclosure action against a unit owner with past due fees. Laws vary by state but in Connecticut the association can recover as much as 9 months of delinquent fees and reasonable attorney costs as part of a standard dues recovery effort. In cases which also involve foreclosure by a bank for mortgage default, that amount can be even greater provided the association file the proper paperwork with the courts during the foreclosure proceedings.

More information and links to the relevant laws can be found at the CAI Connecticut Legislative Action Committee page at All the best!

Originally posted at


Announcement: Join Kim Juda and Mike Marcusky at this years Common Interest Realty Association Conference

Kim Juda and Mike Marcusky will moderate an interactive session at this years “Common Interest Realty Association Conference”.  The topic will be Social Clubs, their structure and tax implications.  The conference will take place November 5th and 6th, 2015 in Fort Lauderdale.

To find out more information please visit

Announcement: Carol Eskew will present at the FICPA’s 2015 30th Annual Accounting Show

Carol Eskew will present at the FICPA’s 2015 30th Annual Accounting Show a session on Updates and Issues related to Common Interest Realty Associations.
The accounting show is September 16th thru 18th, 2015 at the Greater Fort Lauderdale/Broward County Convention Center.

A Simple Way to Plan Your Nest Egg

Ever wonder how much money you’ll need to preserve your lifestyle during retirement? Many financial professionals use a benchmark of 70 percent to 100 percent of your current income to maintain your lifestyle during your non-working retirement years.

For simplicity’s sake, let’s say you’re aiming for a 20-year retirement (the standard calculation as we live longer, healthier lives) at 100 percent of your current spending level. A few uncomplicated steps can give you a rough estimate of how much money you’ll need for your nest egg, where it will come from and whether your portfolio is on track.

Calculate annual spending. Deduct your annual savings from your current income. Since this is only a rough estimate, use pretax figures. If you earn $150,000 and save $30,000 a year, you’re spending $120,000 a year and that’s what you need to take in to maintain your current lifestyle.

Factor in Social Security. Estimate your benefits. If you’ve made the maximum contribution for Social Security during most of your working career, you’ll receive around $20,000 a year at age 65, or about $16,000 if you retire at 62. If you’re married and one of you has a larger lifetime income, the other spouse will get 50 percent of the larger benefit. The Social Security Administration (SSA) regularly mails estimates of current and projected benefits to all working Americans over 25 who have contributed to Social Security. If you haven’t received this statement, ask the SSA for it.

Compute additional income. Add up other money you expect to take in from a pension, investment property rentals or part-time consulting work.

Let’s say you and your spouse are the same age and you want to retire at 62. But one of you earned most of the income. At 62, you could retire with total Social Security benefits of around $24,000. That means you need another $96,000 a year to get to your $120,000 target.

Assuming you expect to generate that extra income solely from your portfolio, multiply $96,000 by 20 years and you get a $1.92 million target (rounded up to $2 million) for your nest egg. You can tap that portfolio for $100,000, or 5 percent, each year of your retirement.

If your retirement lasts longer, remember that you will be earning money on the balance in your portfolio.

Don’t forget to account for inflation. If you needed only $25,000 a year, over 20 years that will more than double if inflation accelerates at an average annual pace of 4 percent.

To maintain the 5 percent annual drain on your portfolio and account for the eroding effects of inflation, your portfolio needs to be growing between at least 8 percent and 9 percent a year. And if you spend more than the allocated 5 percent, you’ll lose purchasing power over the long-term.

One Unknown Issue

How much will your expenses change? Travel and leisure spending are likely to increase, while commuting and clothing costs will decline. If you retire early, health insurance costs will probably rise until Medicare kicks in at age 65 years.

Remember, these calculations give you only a rough estimate of your needs. And they don’t factor in taxes. You may be in a lower tax bracket once you’re no longer collecting a paycheck.

Consult with your financial adviser for a more detailed projection to help insure your retirement years really will be golden.


Originally posted at

Alleviating Resident Concerns About Mold

A malfunctioning furnace, a broken dishwasher, lost keys. All of these are common problems residents run into and bring to their property manager’s attention. Thankfully, each of these scenarios is a fairly easy and quick fix. However, when a mold arises, it is almost always accompanied with a host of other worries and questions.

Below are three frequently asked questions residents with mold problems will likely ask you and the best answers to relieve their worries and help you retain them as renters.

I found a small amount of mold in one area of the apartment, does this mean I have mold everywhere?

No. Finding a little bit of mold is not grounds for tearing down an entire home in search of more!

Let your residents know that mold can only grow in in the presence of water or high levels of humidity. If a resident has identified mold growth around a window where condensation is occurring, keep your efforts localized to that area. Dry areas of the home need not be ripped apart on a wild goose chase for more mold. Focus on the problem area and remove the mold at the source (e.g. the window’s wood trim) and prevent further issues by remediating the water source.

Once the initial problem is taken care of, a cheap way to clear any airborne mold spores in the home (as well as those that may be in a tenant’s imagination) is with a $100 HEPA air purifier. Again, save the wrecking ball for another day.

Alleviate tenant concerns by explaining that an isolated patch of mold is often just that—isolated—and resort to a professional mold removal service only when a true mold problem exists (more than 10 square feet of mold).

I think there might be mold in the residence, should we be performing tests to find the problem?

If mold is visible within the home, testing is nearly always a redundancy and a waste of money. No matter the species of mold in the home –– once identified, all types of mold should be addressed and treated by a professional in the same manner.

However, testing for mold will help to identify if mold is present when suspicions arise (for instance, a moldy smell) but no mold has actually been seen. Although a moldy smell can often lead right to the source, sometimes well hidden mold requires in-home testing for confirmation.

Don’t let a mold removal company convince you that visible mold needs to be tested. Unfortunately, many mold removal services upcharge their customers this way, but the reality is that it’s usually an unnecessary service.

We’ve found some mold that’s black, shouldn’t I be worried about my health?

Mold species exist in a range of colors. The notorious “Black Mold” you have heard so much about in the media is not one particular species of mold. Rather, it refers to all molds that can produce toxins (in this case, the toxins are called mycotoxins).

What is important to know is that not all mold that is black produces toxins, and not all molds that produce toxins are black. Ensure your resident of this fact to alleviate their health scare, and let them know that the mold will be fully removed regardless of what species it is.

As it currently stands, mycotoxins are not fully understood by the science community. According to the EPA, certain types of mycotoxins produced by mold species Aspergillus flavus and Aspergillus parasiticus have been linked to cancer. However, the EPA has stated, “Aspergillus flavus and Aspergillus parasiticus are not commonly found on building materials or in indoor environments.”

The Centers for Disease Control and Prevention also states: “There are very few reports that toxigenic molds found inside homes can cause unique or rare health conditions such as pulmonary hemorrhage or memory loss. These case reports are rare, and a causal link between the presence of the toxigenic mold and these conditions has not been proven.”

However, those suffering from allergies can be affected by the presence of mold, and the jury is still out on whether mold poses a serious health risk for everyone And if it does, removing it is really the only option anyway. Your job as the property manager is to make sure this gets done. And as with any of the situations covered above, what will make you an exceptional property manager is if you are responsive and can simultaneously ease your resident’s anxieties in the process.

Originally posted on PayLease Blog

Condo Residents: Demand Show Me the Money

The image of Cuba Gooding, Jr. as Rod Tidwell screaming at Tom Cruise as the titular character in the 1996 movie “Jerry McGuire” is a powerful cinematic moment that launched the catchphrase, “Show Me The Money”! All these later, I barely remember the movie but the catchphrase lingers as virtually everyone I know has said “Show Me The Money” at one time or another. While it is taken entirely out of context here, you had better believe that condominium residents expect you to show them where their money is going. How well you tell that story can be the difference between ending your story with “…and they all lived happily ever after” and “… and so the hull of theTitanic lies sunken on the ocean floor”!

Let’s begin with the state your community’s finances are currently in. Hopefully, they are in good order with all of your residents paying their fees and assessments, all of your vendors being paid on time, a healthy reserve fund, and no lingering financial clouds of doom. That is an easy story to tell – everything is just fine – happy beginning, very little drama in the middle, and a happy ending. While I wish such an ending for each and every community, the reality of hard times has jumped from the national headlines and landed in many communities across the country. If your community is experiencing financial challenges like so many, may I suggest that you get in front of the story and use your communication skills to keep residents informed and avoid adding to the problems by not telling your financial story.

The good news is that there is light at the end of the tunnel. The bad news is that light may be further away than most of us would care for. Many economists are convinced that the days of bailouts, Bernie Madoff scandals, high unemployment, etc. are set to scale back, meaning a lull in the bad news which may allow the economy to stabilize before rebounding. Many associations find themselves facing the unenviable task of taking action against residents – late fees, liens against property, even foreclosure. While these actions may seem harsh or drastic, many BODs find they are bound by their governing documents to take these actions in order to protect the rest of the citizenry. This is a great time to explain to residents how the system works. They can read the full details in the condominium documents but it is a great idea to reiterate the basic concepts so they can fully appreciate what actions are taken against their neighbors. This can go a long way to alleviate fears that the association finances are about to collapse or that some homeowners are being unfairly targeted by the Board.

Many associations are opting to borrow money to meet their financial responsibilities. Again, there is a very positive story to tell about such action. Borrowed monies ensure that the business of the association continues, even though the current economy appears sluggish. Borrowed monies are repaid over a period of years. Surely, all of us have lived through the ups and downs of the American economy before. There is no reason to think that things are not going to get better. A loan is simply an investment in tomorrow being a better day.

Finally, it is a great time to talk about your community’s accounting efforts. Bookkeepers, auditors, CPAs and others are constantly working to assess and manage your association’s finances. Choose a few selected items from your balance sheet and see if there isn’t a positive story to be told. In my community, our insurance premiums DIDN’T go up this year. After several years of increases, I thought this was a story worth telling. We locked in a two year agreement with our property management company so those fees won’t be going up this year either. These may not seem like big deals but for me they were the difference between ending our last newsletter with a listing of delinquent commons fees (where we sink to the ocean floor) and a happy ending (where we all live happily ever after). Look for your happy ending when telling your community’s financial story. And don’t be afraid when they say “Show Me The Money”. Offer them your thanks for continuing to pay their fees and assessments and look forward to your own happy ending.


Originally posted by Bob Gourley on