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My HOA is over-charging for late-fees

Posted on Sun, Jun 12, 2011 @ 08:02 AM
  
  
  
  
  
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I believe the HOA in my neighborhood is overcharging for late fees. The C&R's indicate that 10% per annum will be added for late assessments. The monthly HOA fee is $55. In this case, my understanding is that this means 10% per year, so $5.50 per yr or $0.4583 per month late fee. The HOA is currently charging $5.50 per month with compounded interest. This hugely differs from what I understand we should be charged. Am I correct in my understanding? And if the association won't discuss the matter with me, who do I contact to get this issue resolved?

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Comments

Anything over 24% per year can be potentialy considered usery and it is against the law
Posted @ Sunday, June 12, 2011 8:21 AM by Benny
Please post tjhe exact wording in yourbylaws as relate to late fees.
Posted @ Sunday, June 12, 2011 8:45 AM by Charles Adler
Pay your fees on time and you won't have to worry. If you don't like the way things are done, attend the meetings, join the Boardm volunteer to make things better.
Posted @ Sunday, June 12, 2011 12:45 PM by Susan
If, in fact, that is what your CCRs say then I would strongly suggest an amendment because that is an absurd requirement. Have you checked to see if there is a state law addressing this, which would trump what your CCRs say? In AZ we have a state law which says "the late fees are limited to the greater of $15 or 10% of the amount of the unpaid assessment." Only charging 10% per annum equates to not charging anything at all, IMO! 
 
 
 
But, I'm with Charles Adler, in that seeing the exact wording from your CCRs would be great. 
 
 
 
Posted @ Sunday, June 12, 2011 2:12 PM by mary
Benny has mentioned "Anything over 24% per year can be potentialy considered usery and it is against the law". While that may be true, I do not believe it appies here. We are talking about a fee, not an annual percentage rate (APR). Though a percentage is used to calculate the amount of a late fee, and a period of one year may be defined, let's not confuse this issue with laws that govern credit and borrowing money. 
 
If the HOA late fee for one entire year is only $5.50, I feel that is too low and probably results in a high delinquency rate.
Posted @ Monday, June 13, 2011 9:59 AM by Troy
My association is charging $35 late fee on a $45 monthly association payment. Is that legal in Illinois?
Posted @ Friday, June 17, 2011 10:38 AM by Dave
Dave, 
 
 
 
I scanned the IL Common Interest Comm. Assn. Act and the Condo Property Act and didn't see anything addressing late fees. So, that would mean that whatever is stated in your CCRs would rule. IMO, a $35 late fee for a $45 mo. assessment seems a bit high. IMO, it should be $10 -- no more, no less.
Posted @ Friday, June 17, 2011 11:42 AM by mary
I am the poster of the original question.  
 
The C&R's read like this:  
 
"Effect of Nonpayment of Assessments: Remedies of the Association. Any assessment not paid within 30 days after the due date shall bear interest from the due date at the rate of ten percent (10%) per annum. The Association may bring an action at law agaist the Owner personally obligated to pay the same, or foreclose the lien against the property. No Owner may waive or otherwise escape liability for the assessments provided for herein by non-use or abaondonment of his Lot."
Posted @ Monday, August 29, 2011 10:43 AM by Crystal
Also, I failed to mention I am in Tennessee.
Posted @ Monday, August 29, 2011 10:43 AM by Crystal
I believe you are using a monthly amount to figure the amount that can be charged per year. It sounds like your association can charge 10% of the annual assessment which is $55 X 12 or $660.00. That would be $66.00 per year or $5.50 per month. Your dues are $55.00 per month, not per year, correct? 
 
Posted @ Wednesday, October 26, 2011 6:23 PM by Evon
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