Does your HOA need money?
Whether you live in a high-rise condominium in New York or a single-family home in San Diego, chances are work needs to happen to keep your community in great shape. Even if your community has done all the right things and put money aside in a reserve fund, the cost of these projects can often be much greater than the association had previously budgeted. Moreover, the board may not want to spend an entire reserve fund on one project. If this is the case, your condo or home association might be trying to raise money…?
Is an assessment your only option?
Most boards believe that the only way for an association to raise a large sum of money is to assess each owner for their portion of the project. This process can be clunky to execute and can be financially burdensome to many owners in the association.
Luckily, there is another way to raise money for the community that minimizes the financial burden and allows the owners to pay it back over time without leveraging their property. The best solution for your HOA might be an HOA loan.
What is an HOA loan?
An HOA loan is a unique type of financing that allows an association to borrow money at a set interest rate and pay it back over time. These loans are dependent on the cash flows of the HOA as opposed to collateral. This means there is no individual property used for collateral. The bank lends money against the future dues of the association.
Who is responsible for an HOA loan?
No one in the association is individually responsible for an HOA loan. Financial institutions loan the money to the association as an entity. Repayment of the loan is the responsibility of the entire association. The board maintains accountability for dues collection along with principal and interest payments. No individual owners are liable for this type of funding.
Learn More About Our HOA Finance Solutions
As one of the largest HOA advisory companies in the nation, we have the HOA and COA financing solutions you need to address your association’s loan-related needs. If you’re interested in securing an HOA loan or finding out more information about our HOA loan services, contact us today!