Cohousing-L Mailing List: Re: protecting your HOA from homeowner bankruptcy

[Sharon Villines (sharon]

We have had no difficulty at all in collecting monthly condo fees. The 
long start up time in cohousing and engagement with neighbors also 
weeds out those who are financially impulsive. The realities of money 
become very clear once you start making decisions about insulation, 
siding, and floor coverings. The truly financially vague fade away. The 
devious see that this is no place to run a scam.

Since owners are owners, they will most often have mortgages. Being 
mortgage worthy is some assurance that a member is financially stable.

When there are personal difficulties (job loss, illness, etc.), owners 
can turn privately to other neighbors who can help them out and since 
the community has been discussing finances for so long, they can more 
openly discuss problems, not necessarily with the whole group but with 
subsets of it. We have a large group but I think everyone here has a 
subset of people with whom they would feel comfortable discussing such 
problems and who would loan them money.

On a deeper level, your bylaws should make provisions for the community 
to place liens against units that owe the association funds. This means 
that when the unit is sold, the association is paid back any funds owed 
to it before the owner gets any money. The title is encumbered so it 
can't be passed on without the lien being paid.

Sharon
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Sharon Villines
Takoma Village Cohousing, Washington DC
http://www.takomavillage.org