Frequently Asked Questions

HOMEOWNER'S ASSOCIATIONS:

What is an HOA?

An HOA or Homeowner Association is a legal entity created to manage and maintain the common areas of a community. Typically these "common areas" consist of things like pools, clubhouses, landscaping, parks, streets and roads.

HOAs can consist of single family homes, condominiums, or town homes and are typically setup by the original developer of the community with a set of rules called "Declaration of Covenants, Conditions, and Restrictions" otherwise known as "CC&Rs".

One of the primary functions of the HOA is enforce and ensure that these "CC&Rs" are adhered to by the individual homeowners. The guiding principals of these regulations are normally to help maintain property values and the quality of life within the community.

If I buy a home within an HOA, do I have to belong to the HOA?

Yes, the only way an HOA can work correctly is if everyone who lives within its boundaries belongs to the HOA and pays dues.  

 What insurance will I need?

The association is responsible to insure the common elements and certain parts of the unit defined in Florida Statutes Chapter 718.111 section 11. The owner is responsible to insure all components inside the unit. If you own a condominium or townhouse, there are two things to remember when it comes to insurance. The association has a master insurance policy that covers the outside of the buildings structure, including the roof and common areas such as pools and sidewalks. The master policy does not insure the inside of your unit or any of your personal belongings. Condominium owners need to obtain insurance to cover additions, alterations, wall fixtures, floor and ceiling of the unit, personal belongings, and personal liability.

It is a form of property ownership. A condominium owner owns a unit exclusively, which includes the airspace in their unit up to the paint on the walls-but not including the walls. The remaining property is considered common area and held jointly by all owners of the condominium. A unit owner becomes a member of a condominium association at the time he/she purchases the unit. Chapter 718 Florida State Statutes, the article of incorporation, the bylaws, and the covenants play an important role in how an association is governed and required to operate.

Our association has several owners who are delinquent in the payment of their maintenance fees. How can NCS help the association to collect these amounts and improve the association’s cash flow?

NCS’s bookkeeping department works very closely with the collection department of several law firms who specialize in the collection of association maintenance fees. NCS has an excellent accounting system which tracks maintenance fee charges and payments and assesses late fees when applicable. NCS also has a very structured program for issuing friendly reminder notices and lien notices.

What are the maintenance fees?

Condominiums are based on the premises of "commonly held" property and "air rights". In addition to the air rights that each homeowner has, they also own a share of the common areas such as the building structure, parking lots, pool, planters, tennis courts, etc. So, maintenance costs are spread out among all of the owners in the form of a "maintenance fee.  

What is the difference between the HOA and the board of directors?

The HOA consists of all owners within the geographic boundaries of the HOA. Each and every owner is a member of the HOA. Membership is not optional. The Board of Directors consists of those owners who have been elected to conduct the day-to-day business of the HOA and make the decisions that affect all owners.

What is the difference between a review and an audit?

A financial review consists of the auditor inquiring of association or management company personnel in order to verify the financial records of the association. Unless deemed necessary, the accountant is not required to obtain any independent corroboration to substantiate the personnel presentations. In contrast, as part of a certified audit, the auditor must obtain independent evidence to substantiate the assertions made by the association's employees and management.