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Find Blog Articles for Florida’s Condo, HOA and the Management Industry. 

Lighting of Tomorrow facilitates communities to switch from inefficient lighting fixtures to new state-of-the-art LED lighting technology.

Lighting of Tomorrow facilitates communities to switch from inefficient lighting fixtures to new state-of-the-art LED lighting technology.

  • Posted: Dec 13, 2021
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Lighting of Tomorrow facilitates communities to switch from inefficient lighting fixtures to new state-of-the-art LED lighting technology.

 

How to Reduce Commercial Energy Usage

These recent days, we are going through some real problems such as an increase in energy usage. Also, when it comes to solving these problems, people cannot really think of the solutions. Hence, we are here to provide the solutions on How to Reduce Commercial Energy Usage.

Thus, here are some tips to reduce energy usage:

Equipment functioning should be checked

The equipment functioning should be regularly checked now and then. There should be a proper check of the equipment, and even it should be double-checked. This can also lead to the improvement of the equipment in commercial settings.

Increase in Usage Air Compressors

Air compressors are one of the best solutions to reduce energy reduction. The drive motor is the main element of the air compressor. And, the latest systems allow for these drives to use a change in frequency that reduces the power that the drive is requesting (depending on load).

Plant and Trees Outside Your Commercial Property

Plants and trees must be planted on the south and east sides of your commercial building. These plants and trees will provide proper shade in the summer, which leads to a reduction in the cooling load, and will allow sunlight to enter your building in the winter, reducing the heating load as well.

Update the Regular Lighting to Modern Technology Lighting

If you have old and outdated lighting LED lighting can make a quick, moving impact on your energy consumption. Converting your old lighting to LED lighting may result in a decrease of up to 60% of the electrical costs of your daily lighting energy consumption.  LED lighting also has some additional benefits such as less heat generation that results in reducing your air conditioning load as well as reducing your maintenance costs as well.

Install Energy Effective Practices

Getting your employees to participate in energy-saving rituals is an effective way to help decrease energy expenses. You can also create incentives or competitions to check how low a commercial property can get their average energy to spend per month is quite an innovative way to boost employees toward saving energy.

Conclusion

Hence, these were some of the tips on How to Reduce Commercial Energy Usage and specifically when you can just change certain lifestyle habits. Thus, you can just introduce these tips as rituals in your commercial property to reduce energy usages very effectively.

Contact Us

840 E Oakland Park Blvd 117 Oakland Park, FL 33334

954.626.0267

info@lightingot.com

About Us

Lighting of Tomorrow is commited to providing our clients energy saving lighting solutions. We provide a complete service, so we can continue “lighting the way for a sustainable tomorrow”

 

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Call Pioneering Pest Services today for your free estimate on any of our services!! ☎️ 386.734.2142 ☎️

Call Pioneering Pest Services today for your free estimate on any of our services!! ☎️ 386.734.2142 ☎️

  • Posted: Dec 10, 2021
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Call today for your free estimate on any of our services!! ☎️ 386.734.2142 ☎️

Send us a Facebook message or email spetit@pioneerpestservices.com for more information!

☘️Lawn & Shrub care   🐜 Pest Prevention  🪳Termite Protection

Fertilizer ☑️ Insect control ☑️
Weed elimination ☑️

Dependability starts with Pioneer Pest Services!

Pioneer Pest Services, Inc. was established in 1985 and proudly serves Volusia, Flagler, Lake, and Seminole counties. We are a local family-owned and operated company with a proven track record for reliable and professional pest services.

Our goal is to partner with homeowners, business owners, and property managers to control pest, termite, and lawn and shrub problems. We will immediately assess and address current pest issues, as well as your lawn and shrub needs, and help you to prevent them from happening in the future.

Whether they fly, creep, sting, or swarm, pests are a persistent problem for Floridians—and they can do serious damage if they’re not kept in check. At Pioneer Pest Services, we understand that pests need to be taken care of promptly and effectively. That’s been our mission for the past three decades! A local, family-owned company, we’re committed to quality service for residential and commercial customers in Volusia, Flagler, Seminole, and Lake counties. RELIABLE PEST SERVICES SINCE 1985

Protecting your property is our priority, call us today for a FREE estimate. 📱386.734.2142📱

Members of SFPMA: View our Membership page.

 

 

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Community Association Collections 101: What Happens When An Owner Files For Bankruptcy? by Axela’s / Mitch Drimmer

Community Association Collections 101: What Happens When An Owner Files For Bankruptcy? by Axela’s / Mitch Drimmer

  • Posted: Dec 10, 2021
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It seems as if bankruptcy will be the next big subject, this article is a step by step process for community associations

Community Association Collections 101:

What Happens When An Owner Files For Bankruptcy?

by Mitch Drimmer

Bankruptcy NoticeThe collections process isn’t a fun one, and depending on what causes delinquency, it can get complicated. A homeowner who falls behind on just their association payments is one thing, but someone who’s so behind on all of their financials that they have to declare bankruptcy is a very different story. We’re asked all the time about what happens when a condo or HOA has to deal with homeowner bankruptcy. If your association is dealing with a bankrupt homeowner who is not paying their post-bankruptcy amounts, there are decisions to be made and steps that can be taken. Let’s review what must happen and how the community association can best navigate this situation.

 

 

Two LedgersWhat Happens When Bankruptcy is Filed?

Filing for bankruptcy isn’t a quick process. When a person, known as the “petitioner,” files for bankruptcy, they must file a list of their creditors with the bankruptcy court (which is a federal court). The creditors will be noticed with a “bankruptcy notification” and will be given a time frame by which to respond, usually under two months. Government claims can be submitted up to six months after the petition date (it’s good to be the government.)

There is no requirement that the response (or proof of claim) from the creditor must be submitted to the court via an attorney, which is good for you–the less an association is required to spend on costly attorney fees, the better. This proof of claim can be submitted by the association directly, the management company, or by a collections partner like Axela. Just be sure that everything that is legally owed to the association is included on that proof of claim–this should include assessments, late fees, late interest, fines and violations, special assessments, and any other sundry items that have been charged to the property. Be sure to double-check the ledger because it is expensive to get a second bite at that apple if you find you want to amend your claim with the court.

From there, the bankruptcy court will hold a “341 meeting,” which is a meeting between the debtor and the creditors but it is not mandatory for any creditor to attend. Then comes the really complicated part.

 

Types of Bankruptcy

It is important to know what type of homeowner bankruptcy you are dealing with as this knowledge will direct your business decisions going forward. When a property goes bankrupt in a community association, the community needs to prepare two ledgers: a pre-petition ledger and a post-petition ledger. You cannot add the post-petition amounts to the bankruptcy claim because next month’s bills are not this month’s debts. Regardless of which kind of bankruptcy they have filed, the petitioner has an obligation to pay the post-petition amounts during the bankruptcy. If the delinquent owner is NOT paying their post-petition debts, the association needs to make a decision and take action immediately, and the type of bankruptcy will determine which steps to take

 

Chapter 7

Complete wipeoutChapter 7 bankruptcy, also known as “no-asset” bankruptcy, is a complete wipeout. This means that no money will be recovered from the pre-petition amounts.  A Chapter 7 bankruptcy case can take as little as six months to complete because there is no settlement to be made. Creditors can claim to the court that there are assets being hidden but, in most cases, it is all over fairly quickly. If the delinquent owner is not paying the post-petition amounts, then the association can wait until the case is discharged and then move forward with collections activity. If the owner has been paying their post-petition amounts, then the issue is resolved albeit the association has taken a hit.

 

 

Chapter 13

Wage Earner;s PlanChapter 13 bankruptcy is known as a “wage earners plan” and is a workout where the court will make a settlement and oversee it until the payment plan has been completed. This is when the association needs to make a business decision.

In a Chapter 13 bankruptcy case, the pre-petition debts will not be discharged for 3-5 years, and the petitioner remains in bankruptcy. If they are not paying the post-petition amounts, the association cannot submit the delinquency for collections or to an attorney for foreclosure. The only course of action is for the association to ask the court for an “injunctive stay of relief” which is essentially asking the court to allow the association to move forward with collections and or foreclosure efforts.

 

So What Needs to Be Done?

If a unit owner files for Chapter 13 bankruptcy and is not paying their current assessments, it is not a stretch to believe that most likely they will never pay. It is unfair that the association needs to wait three to five years until the pre-petition debts are paid, the delinquent owner is discharged from bankruptcy, and the association can finally move forward. As we mentioned above, if a delinquent owner has filed for Chapter 13 bankruptcy and is not paying their current assessments, the association should file with the court a motion for injunctive relief. During the gap period, section 1519(a) of the Bankruptcy Code states that a bankruptcy court has the power to grant provisional injunctive relief and certain other forms of relief where “relief is urgently needed to protect the assets of the debtor or the interests of the creditors.” Additionally, an order staying execution against the debtor can also be granted. If a property owner is not paying their assessments, then the case can be made that a stay order is required to protect the assets (the property).

 

How to Handle Homeowner Bankruptcy in Your Association

The same way you’d handle any other bankruptcy situation in your association: call a professional. Homeowner bankruptcy in your association can be managed and worked through, but it takes a lot of knowledge and a lot of time. Many times, when a management company or a board of directors is reviewing delinquencies, the units that are delinquent and are also in bankruptcy get glossed over. There is a feeling that once a delinquent owner files for bankruptcy, the association has no options other than to wait until the bankruptcy is discharged. This is not the case as there are options and every case is unique. Axela Technologies has the experience, knowledge, and experience to deal with all these contingencies. Call us today for a no-cost, no-obligation analysis, and review of your delinquencies.

Mitch Drimmer Axela Technologies

Mitch Drimmer
President of Business Development
Axela Technologies

Connect with Mitch on LinkedIn

About the Author

Mitch Drimmer is a respected thought leader in his field and has led numerous continuing education classes in collections, His articles have been published in key trade journals and newspapers, and he is a speaker at educational seminars.

As the President of Business Development for Axela Technologies, Drimmer works with community associations and their management companies to introduce innovative strategies to collect delinquent maintenance fees.

Throughout his career, Drimmer has worked with community associations to help them see their way through tough times, especially during the real estate crash. He is a passionate advocate for community associations and has participated in the legislative process over the years trying to bring fair and equitable legislation that serves community associations.

Drimmer earned a Bachelor of Arts in History from Hunter College in New York City, and has worked in the community association collections space since 2007.

 

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Corey Parshall is the founder of Parshall Tree Care Experts, a full-service tree company offering reinvented solutions to outperform and challenge the industry

Corey Parshall is the founder of Parshall Tree Care Experts, a full-service tree company offering reinvented solutions to outperform and challenge the industry

  • Posted: Dec 03, 2021
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Corey Parshall is the founder of Parshall Tree Care Experts, a full-service tree company offering reinvented solutions to outperform and challenge the industry.

They deliver services to residential, commercial, municipal, and utility clients in Michigan and Florida! With a desire to break stereotypes and bring the tree service industry into the 21st century, Corey designed a business with unparalleled service.

Entering the market, Corey saw opportunity in the outdated practices that ensnare other companies. He understood the pitfalls in the tree service industry and decided to do his part to change it. He saw under-serviced clients and poor service in general. Using his entrepreneurial spirit, he started his own company to address these problems. Leveraging changes in technology, Parshall Tree Care aims to challenge themselves with creative ways of thinking, always looking to push the industry further.

Corey’s biggest challenges are the unknowns. In the early stages of running his business he experienced a lot of trial and error, discovering this was the most expensive way to learn and grow. Rather than bleeding money, Corey started investing in resources to grow his team instead. He found mentors that could help with problem-solving and educate the team. Before he knew it he had a clear roadmap that prevented him from constantly having to relearn everything.

 

With a mind focused on the positive, Corey believes your goals are within reach. A negative outlook can erode your confidence in taking calculated risks, while a positive outlook brings opportunity. Corey has noticed that when he keeps a positive mindset relationships line up, doors open, and he is generally luckier as an entrepreneur. By overcoming his biggest obstacle of thinking small, he found great success by intentionally setting unobtainable goals just to see what he and his team can achieve. Corey pays attention to fears that creep up when goal-setting. To him, fear is a communicator that action is needed to reach the desired opportunity.

For anyone interested in starting their own business, Corey recommends setting outrageous goals. He recommends anything considered to be a “good goal” should be multiplied by 1000 because you will probably underestimate rather than overestimate. Low expectations lead to boredom and if your business is boring you’re more likely to give up. Once you have a plan set, Corey suggests finding mentors, even if you have to pay for them. Learning from the experience of others saves you time and money in the long run.

Success, to Corey, is building a team that includes his family. In doing so, they find freedom from being tied down by that which is out of their control. He finds financial freedom knowing he and his family enjoy a better quality of life, and he has a legacy to share with generations to come. He loves sharing his success with his team as they experience the same freedom. At the end of the day, Corey’s dream is to see the entire tree service industry revolutionized—that they can leave a generational impact and improve an outdated industry.

Corey is so grateful to his staff for everything they do to help carry out the company’s mission, and to his clients who trust him to provide his service. He knows he can’t make a difference in the tree industry without either piece missing. This company isn’t about Corey Parshall, but the Parshall Tree Care Experts revolution. Parshall Tree TV, a free educational platform, is the latest division of the company.

 

Parshall Tree Care Experts

also have plans to grow their new offices in Ohio and Indiana, then expand toward the eastern US to Florida. But Corey’s ultimate goal is to be known as the industry leader in the tree service community.

Corey Parshall
Founder
Parshall Tree Care Experts
corey@parshalltreecare.com
877-250-2060
http://parshalltreecare.com

 

 

 

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There is plenty of time to let the community members know what the new monthly assessments will be for the coming year.

There is plenty of time to let the community members know what the new monthly assessments will be for the coming year.

  • Posted: Dec 02, 2021
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Budgets: Boards How are you doing?

Most community associations have their budget meeting in the month of November for the upcoming year.  By doing it in November there is plenty of time to print new coupon books and let the community members know what the new monthly assessments will be for the coming year.

In terms of notice, in a condominium the budget must be sent to the owners at least 14 days before the budget meeting.  In an HOA, The association shall provide each member with a copy of the annual budget or a written notice that a copy of the budget is available upon request at no charge to the member.

Don’t forget that in a condominium, in addition to annual operating expenses, the budget must include reserve accounts for capital expenditures and deferred maintenance. These accounts must include, but are not limited to, roof replacement, building painting, and pavement resurfacing, regardless of the amount of deferred maintenance expense or replacement cost, and any other item that has a deferred maintenance expense or replacement cost that exceeds $10,000.

Condo boards need to be well aware of the reserve requirement.  To be clear, the Board MUST send out a budget that includes fully funded reserves.  That is all they are required to do.  However, if they want to, they can give the owners the opportunity to vote for an alternative budget such as a budget that contains no reserves or partially funded reserves.  Remember that if a majority of a quorum of owners does not vote for a budget that does not contain full reserves, fully funded reserves shall go into effect.

In a post Champlain Towers world, I think things may be a little different this year.  I think lots of Board members will want to have fully funded reserves in their budget.  They don’t want to be short millions of dollars when the time comes, and it will, for millions of dollars in repairs.

Delinquencies are starting to pick up as well.  So, make sure you have a line item in your budget for “bad debt.”   For example, if your assessments are $6,000.00 per year and you’re pretty sure that 5 owners won’t pay  a dime, you should put $30,000.00 as an line item in your budget for bad debt.  That way you collect enough money to pay the bills.

Keep in mind that electricity prices are expected to rise 18%.  Also remember that some of your long term contracts may have clauses requiring automatic rate increases every single year.  F I still get the same question all the time…who passes the budget; the board or the unit owners? The answer is…the board and only the board.  Food prices are going up, the cost of materials are going up, electricity is going up, the cost of labor is going up, and worst of all, insurance rates for condominiums are simply skyrocketing, with some associations complaining that their rates have tripled.  So, all this means in no uncertain terms, that condo assessments are about to go up as well.  It also seems pretty clear that it will become extremely difficult if not impossible to waive reserves starting next year.  Yes, it’s about to get a lot more expensive to live in a condominium, especially if you were kicking the can down the road and always waiving reserves.  I don’t envy condo boards at their next budget meetings where they will be forced to tell the members of their community that their monthly assessments are about to go up, in fact way up.  Buckle up everyone in a condo, you’re in for a bumpy ride going forward.

 

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With all the news about the Smash and Grab crimes in the news, We felt compelled to let you know the members in our Security and Surveillance helping Condo and HOA’s with Protection Services.

With all the news about the Smash and Grab crimes in the news, We felt compelled to let you know the members in our Security and Surveillance helping Condo and HOA’s with Protection Services.

  • Posted: Nov 30, 2021
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First of all it is the Safety of each and every Owner in our buildings that concerns us.  Now days this should be the first thought for all Board Members.

Next should be How and Where you can find the best companies for this decision for protection of the property.

 

SFPMA provides a Directory of the Top Professionals for Condo and HOA’s in Florida. 

This open Directory is avail for all to view, in budget season you should be looking for the right companies for your buildings and Owners within, Find and reach out for the services they offer you and your communities.

 

Below are a few of our Member Companies: 

United Security, Inc

1.800.874.6434

United Security Inc. (USI) provides contract security solutions and investigation services to a select group of vertical markets. For the past 29 years, USI has created safe, secure environments for commercial and government employees and customers by investing in our people, innovation and relationships. USI is committed to delivering:

  • Responsive management and security personnel
  • Continuous quality improvement and training
  • Consistent, client-focused service and performance

 

For the past 27 years, USI has created safe, secure environments for commercial and government employees and customers by investing in our people, innovation and relationships. As engaged, owner-operators, our investment begins with recruitment and screening to ensure we have the right people and continues through our policies and practices that enable USI to properly train and retain the best personnel.

ArchAngel Security

561-542-9263

Welcome to Archangel Security

After years in parking compliance and towing services, we saw a real need for organized, reliable, and effective security services for residential and commercial property managers.

We keep costs low, services safe and simple, and always protect the property first. Our licensed and trained security monitors are ready to help you take and maintain control of your parking compliance and safety needs.

We are licensed in the state of Florida, LIC #B1400043 and insured.

 

 

FSW First Response Solution Inc

352-818-9499

Safety is Top Priority

FSW First Response Solution Inc. serves residential, commercial, government, and industrial clients. Through our top-notch, 24-hour security services, we’ll ensure your safety and protection.

In this modern age, it is never wrong to be extra careful when it comes to hiring security. We should do all the things necessary to ensure our property and loved ones’ safety.

Hire our expert crew here at FSW First Response Solution Inc. We are a family-oriented organization that provides safety and security solutions to every household and establishment in Florida. Contact us to request for free quotes and estimates!

 

 

Here are other ways Buildings should look into for Security

All In One System – manage so many devices on you properties. you control access for owners and guests at your fingertips!

Smart Entry Systems

(626) 213-7557

All In One System – manage so many devices on you properties. you control access for owners and guests at your fingertips!

  • Simple Installation, Wirelessly connects to the Internet using plain WiFi without the need to pay for land lines, POTS, VOIP, SIP, nor LTE.
  • Surveillance Camera Integration, Pull images from other camera(s) mounted near by the entrance for a multi-directional view of the access  w/ event in the entry log.
  • Create temporary guest codes for pre-authorized visitors using the phone app.
  • Conveniently manage your property with a browser from anywhere with Internet access.
  • Accept deliveries from any shipper, residents can collect packages 24/7. Mix and match from 9, 6, or 4 door models to suit your community.
  • Eliminate coins from communal washers, dryers, electric car charging stations, short term rentals of conference and party room

Smart Entry Systems

http://www.smartentrysystems.com/
(626) 213-7557
sales@smartentrysystems.com

iDENTYTECH Solutions America, Inc.

888 703-7150

iDentyTech is a leading provider of intuitive Identity management products and solutions. Founded in 2010 IdentyTech™ provides its worldwide customers with best-in- class complete identity management solutions. We further offer custom engineered solutions for those customers requiring proprietary solutions. IdentyTech has field proven solutions for Corporate Enterprise, government and Financial services, healthcare, schools, Transportation, Small Medium businesses and many others.

With over 15 years’ experience in the industry, our team will respond rapidly to your needs, no matter how complex or unique they are. Matched by business-focused, technical support, our response to your objectives has led to the highest levels of customer satisfaction in the industry. At the heart of the company, is a team of skilled developers, programmers and technical support staff, Along with sales, marketing and administration staff that are committed to providing our customers with unrivaled solutions, expertise, service and support.

 

 

Rodrigo Perez de Tudela
305-505-7132
rodrigo@identytech.com
Sales and Business Development Director
iDENTYTECH Solutions America, Inc.

 

FIND COMPANIES TO HELP YOU WITH YOUR BUDGETS RFP’S

If you are not a Listed Member Get listed today!

 

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Mulch For You – We have a fleet of nine high-end mulch installation vehicles with the ability to blow yards of mulch products we carry in a single visit.

Mulch For You – We have a fleet of nine high-end mulch installation vehicles with the ability to blow yards of mulch products we carry in a single visit.

  • Posted: Nov 30, 2021
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Mulch For You, Inc

 

Mulch for You was originally established as Bolling Forest Products by Russell Mueller over thirty years ago. His vision was to build a company and its reputation by consistently providing the highest quality products and service to each and every customer. This is the foundation and cornerstone of what Mulch For You has become and is today.

We’ve always been known as the leader in providing innovative new methods and products and the first in Central Florida to bring Mini Pine Bark Nuggets and Classic Red Designer mulch to the market. Since then, we’ve introduced ADA Engineered Playground Chips and created multiple designer mulches in a variety of textures and colors. We’ve also been instrumental in helping guide the market away from environmentally sensitive woods such as cypress. In 1998, we introduced the express mulch blower service to Central Florida. Today we have a fleet of nine high-end mulch installation vehicles with the ability to blow yards of mulch products we carry in a single visit. This service has eliminated the time-consuming and backbreaking work of shoveling and spreading mulch by hand.

Our team cares deeply for the work they do and understands how much it means to have a beautifully finished job. Our company not only has the knowledge and experience to do the job right, but also quality products we know and trust. It’s what we do.

We look forward to working with you and meeting your mulch and soil needs

Maddy Weeks
mweeks@mulchforyou.com
Express Blower Sales Manager
407-869-9003
Mulch For You, Inc
1705 EE Williamson Rd. Longwood, Fl. 32779
http://www.mulchforyou.com

SFPMA’s Reserve Funding for your Communities

SFPMA’s Reserve Funding for your Communities

  • Posted: Oct 29, 2021
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Reserve Funding 101

Reserve Funding for your Communities

A reserve fund is a special account for the long-term repair and replacement of commonly-owned property in a community association.

A good example of this is the roof of a condominium building. All of the unit owners in the building share ownership of the roof. Every 50 or so years, the singles and other items will need to be replaced. The condo association will set aside a specific amount of money each year to go towards replacing/repairing the roof.

When an association plans for a reserve fund, they call on trained experts known as reserve specialists. These assess examine every detail of the association’s common areas to determine their lifespan and condition. They also include factors such as inflation to determine the cost of replacement at the end of the item’s lifespan.

Finally, the last step is to determine how much money the association needs to set aside each year. There are three basic plans for reserve funding: baseline, threshold, and full funding. These determine how prepared the HOA or condo will be when the item’s lifespan is up.

Full funding offers the least amount of risk for owners. With full funding, the replacement item in question will be fully funded by the end of its lifespan. With threshold funding, the association plans to have a certain limit, say 50%, of the item paid for by the end of its lifespan. The up-side to this is cheaper dues. The down-side is that is puts the owners at a greater risk of reaching the end of the item’s lifespan without having the proper funds available to repair or replace it. Finally, baseline funding aims to keep the reserve fund above a $0 balance at the end of the item’s lifespan.

Whichever path the association decides to take, the funds needed are figured in the budget. A portion of the regular assessments paid by homeowners or unit owners goes towards the reserve fund. Some states require associations to maintain a reserve fund by law. Most of the mortgage loans on condos are underwritten by the Federal Housing Administration. The FHA requires that a minimum of 10% of the association’s budget be designated for the reserves. If an association is not allocating at least 10% of its budget, it loses it’s FHA certification. This will almost always have negative consequences for the unit/home values.

Aside from that, who really wants to buy into an association that isn’t planning ahead? That isn’t executing good judgement, and should be a red flag to potential buyers. Adequately maintaining a reserve fund will mean higher assessments over the course of time. However, this is much better than the alternative of a large special assessment. If you community association needs guidance when it comes to reserve funding, trust the financial experts at Clark Simson Miller. We’re not reserve specialists, but we have over 100 years of combined experience in the association management industry. We’ll be glad to schedule a consultation and assess your community’s overall financial health.

 

Private money loans from Gelt Financial can be the ideal solution when you are financing an “out of the box” real estate transaction. Whether you need to close fast, have a distressed asset, or need a non recourse loan, Gelt Financial can offer a competitive loan program just for you. Gelt Financial is a nationwide lender on all types of existing real estate including office, retail, multifamily, self storage, industrial, NNN, mobile home parks and more

Gelt Financial is a commercial non-bank mortgage lender, focusing on mortgages between $50K and $5MM.
Since 1989, Gelt has closed over 10,000 loans

COMMERCIAL REAL ESTATE LOANS

Whether acquiring or refinancing a commercial investment property or owner-occupied property (mixed-use, apartments, retail, office or mobile home parks), we will always help you get the most competitive terms.

MULTIFAMILY REAL ESTATE LOANS

With our strategic private and banking lenders, we are able to cut through the lengthy process to fulfill your financial goals.

BRIDGE & SHORT TERM LOANS

Whether historic cash-flow or a distressed value-add property, we can secure bridge loans at competitive rates.

HARD MONEY LOANS

Need a quick boost of cash flow?
Gelt can secure you financing on numerous types of collateral.

 

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The association suddenly needs a lot of money. How do you get it? Which way makes sense?

The association suddenly needs a lot of money. How do you get it? Which way makes sense?

  • Posted: Oct 29, 2021
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The association suddenly needs a lot of money. How do you get it? Which way makes sense?

So many of our buildings are approaching the 40 year mark, requiring recertification in electrical and structural.  Many buildings are younger yet still need major repairs to the concrete, balconies, pool decks and other portions of the common elements.  The board is going to need a lot of money.  Assuming you don’t have enough in reserves, how do you get it?

Of course, one way is to simply pass a special assessment.  In effect, that means that you will have all the money necessary to pay for all the repairs, before the repairs are done.  The problem with a special assessment…………. Everyone has to come up with a lot of money relatively quickly, if not immediately.  Some people simply don’t have it.  If they don’t they face possible foreclosure by the association.

What is certainly becoming the more common way of coming up with money to make repairs to the common elements is for the association to borrow the money from a bank.  Rates are still very low and money is very cheap right now.  Typically, the bank gives the association a line of credit for one year that the association may draw upon to pay for the cost of repairs.  After one year, the funds borrowed from the line of credit are converted to a term loan, usually anywhere from three to seven years.

There are of course many advantages to borrowing rather than assessing.  First and foremost, the owners need not come up with their entire share of the special assessment immediately.  Instead, they get to pay off the bank loan over several years.  In addition, the board can establish payment schedules that would allow the owners to have a choice of paying their share of the loan off immediately and without interest.  Or, the board can allow the owners to pay off their share of the loan over time, with interest.

Before signing for the loan, the bank will always ask association’s counsel to review the governing documents and write an “opinion  of counsel” as to whether or not the association has the right to borrow money.  Under the Florida not for profit statutes, the association has the right to borrow.  However, the governing documents should be read carefully because sometimes it clearly states that the association cannot borrow money without a vote of the community.

In terms of collateral, the association is not signing a mortgage encumbering the common elements.  Remember, the common elements are owned by the owners and not the association.  Instead, the association will be signing a Collateral Assignment of Lien Rights which authorizes the bank to demand the monthly assessments directly from each unit owner, should the association default in its payment obligations to the bank.

If you have any additional questions about how the process works, give us a call.  By Eric Glazer, Esq  http://condocrazeandhoas.com/

 

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