If left unchecked, delinquencies can become a big problem for your association. It isn’t unusual for someone to miss a payment or two, but when left unaddressed these debts can swell and cause major (but not irreparable) harm to your community. Collecting HOA delinquencies from your neighbors can be an uncomfortable task but allowing dues to go unpaid out of some misguided sense of kindness will only make the problem worse. The accounts receivable of a community association should be available to all owners, and if it gets out that someone isn’t pulling their weight, tensions can rise.
Community association Collections or for that matter any debt that is delinquent often deteriorates into a bitter cycle of pain. The property owner may fall into hard times and cannot afford their payments due to unforeseen consequences, and an unfortunate process begins. First, there is the courtesy notes from the association and then if that fails to result into a payment the matter is sent to either an attorney or community association collection agency for action.
The classic definition of a Zombie is “the undead.” That is to say a person is dead but still has some features of being alive so in essence they are not “totally dead.” It sounds creepy, and it is creepy, but in almost every community association in these United States there lurks “Zombie Debt.” Zombie Debt is best described as money an association has written off because a bank has foreclosed and there were dues owing that the association never received. The mistake is that this debt is not dead and much like a Zombie it still lives and can be collected. So why have not boards of directors and management companies not attempted to collect this Zombie Debt?