1. What are the steps a Florida HOA needs to undertake HOA collections?

To collect past due fees, a Florida HOA is required to:

1. Send a written notice to the homeowner

2. Apply late fees and interest as per the governing documents

3. File a lien on the property if allowed by the HOA’s documents

4. Consider turning the account over to a collection agency

5. As a last resort, file a lawsuit or initiate foreclosure proceedings

2. Who collects the fee for an HOA resale package in Florida?

The HOA or its management company typically collects the fee for a resale package. The seller is usually responsible for obtaining and paying for this package.

3. Are HOAs required to follow the Fair Debt Collection Practices Act (FDCPA)?

HOA collections are not in and of themselves subject to the FDCPA, or the Florida Consumer Collection Practices Act (FCCPA), because the regulations generally govern agencies and law firms that collect on the behalf of a creditor. However, if the HOA hires a third-party debt collector such as a law firm, that law firm’s communications with the debtor must comply with the FDCPA and the FCCPA.

4. Are HOAs exempt from collecting sales tax in Florida?

Generally, HOA dues and assessments are not subject to sales tax in Florida. However, if an HOA provides services that would normally be taxable, they may need to collect and remit sales tax for those specific services.

5. Can a Florida HOA collect dues after foreclosure?

After a foreclosure, the association may collect past due HOA dues from the new owner of a property who has purchased the property after the foreclosure. Florida Statute Chapter 718 Section 116, one of the state’s safe harbor laws, set out the specific rights and obligations of new homeowners who acquire a home after foreclosure. In the statute, HOAs may attempt to collect the lesser of either 12 months of assessments incurred immediately prior to the foreclosure or up to 1% of the first mortgage debt under specific circumstances laid out in the statute. If all conditions are met and payment is not made by the new owner to the association, then the HOA is entitled to place a lien on the property for the amount in question and proceed with all collection’s measures and actions provided for by law.

6. Does an HOA have to send a certified letter before turning a member over to a collection company?

While not strictly required by law, it’s generally considered good practice for an HOA to send a final notice via certified mail before involving a collection agency. This ensures the homeowner has been properly notified and gives them a last chance to settle the debt.

7. Can Florida HOAs collect money from probate estates?

Yes, Florida HOAs can file a claim against a probate estate for unpaid dues and assessments. The claim should be filed within the time frame specified by Florida probate law, which is currently two years. Note though that debts are settled in an order set by state law. If the estate runs out of money before a creditor is paid, then they will not be reimbursed.

“Florida HOAs can file a claim against a probate estate for unpaid dues and assessments.”

The Importance of an Attorney

While HOAs have robust legal rights to enforce fines and collect dues and assessments, there are a number of restrictions, obligations and limitations that need to be taken into consideration. Because of this, it is advisable that association members do not attempt to “go it alone” when attempting past due collection action against a homeowner. An Florida HOA attorney with extensive local experience can help to ensure that the HOA acts in a compliant manner and increase the chances of the money due being collected.

South Florida Law

The Fair Debt Collection Practices Act (FDCPA) and specific Florida statutes govern debt collection activities conducted by HOAs and the third-party collections agencies and law firms they hire. It is crucial for HOAs and homeowners to be aware of their rights and obligations according to the provisions of these laws. South Florida law represents both homeowners and associations in disputes involving fee collections. By retaining our firm, HOAs can ensure that their collection efforts remain fair, transparent and respectful to homeowners in compliance with all relevant laws, by laws and regulations. Likewise, homeowners retain the services of our firm because we aggressively assert their rights and protect them from abusive, misleading, unfair and non-compliant debt collection practices.

If you have any questions or concerns about HOA fees, debt collection practices, or the FDCPA, reach out to South Florida Law either via our contact form or by calling (954) 900-8885.