Question:
In what can a condo HOA in FL invest their reserve funds? Can they be investing in money market funds where they are not FDIC insured and have a possible risk of loss (tiny though that may be)? Can they invest in a diversified stock/bond portfolio for items where the reserve funds are likely not needed for 20+ years?
– Carla
Answer:
Hi Carla,
According to the Florida Homeowners’ Association Act Section 720.303(6)(h), the reserve funds and their accruing interest shall remain in the reserve account(s) and shall only be used for authorized reserve purposes unless the use for other purposes is approved in advance by a majority vote at a meeting with a quorum. Hence, the HOA may invest the reserve funds if a majority of voting members at a meeting with a quorum approve the investment. It’s also important to review the governing documents to verify whether or not the HOA is allowed to invest the reserve funds. For further guidance, kindly consult a lawyer.
Disclaimer: We are not lawyers. The information provided on this website does not constitute legal advice.
