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BEG, STEAL OR BORROW – OR FORECLOSURE?
By
Jan Bergemann
Published September 17, 2021
Many of
the old condo buildings in the State of Florida are facing
serious structural repairs that will cost millions of dollars.
And – from what I hear from many owners – most of these
buildings have no reserve funds that will cover even most of the
cost of these structural repairs.
But these
repairs have to be done if the building doesn’t want to face the
same fate as the Champlain Towers South in Surfside. And you can
be sure that building departments will now push the issue of
certification requirements.
That begs
the question: How are these associations are paying for these
very costly repairs?
The smart
associations took care of fully funded reserves, but as we have
seen, most of these associations are not really “smart!”
But
having reserve funds may cause another problem: Big amounts of
money are very tempting – and we have seen in the past that
board members and CAMs can’t resist the temptation – and the
money is gone when needed.
Asking
for fully funded reserves require laws that protect these
reserve funds and answers any scams and/or embezzlement with
harsh punishments, not just a slap on the wrist. And that should
go as well for board members who buy nice palm trees with the
money that was in the roof reserve fund!
The other
option to pay for these repairs are bank loans, an option
available to most of these associations if properly done. But
don’t forget: Owners will have to pay in the future monthly
quite a lot of money to service this loan. Now owners are paying
the money they didn’t pay in the reserve funds earlier – but now
with lots of interest added. Smart move? Definitely not!
But the
only other option to pay for these repairs is to levy a special
assessment. That’s the worst of all options because these
special assessments can be very huge, in the tens of thousands
of dollars. Amounts many families living in these condos don’t
have available – and the worst scenario will happen:
FORECLOSURE! Families will be losing their homes. Is that
the option you want to go?
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Jan Bergemann is president of Cyber Citizens For Justice,
Florida
's largest state-wide property owners' advocacy group.
CCFJ works on legislation to help owners living in
community
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associations. He moved to
Florida
in 1995 - hoping to retire. He moved into a HOA, where the
developer cheated the homeowners and used the association dues
for his own purposes. End of retirement!
CCFJ was born in the year 2000, when some owners met in
Tallahassee
- finding out that power is only in numbers. Bergemann was a
member of Governor Jeb Bush's HOA Task force in 2003/2004.
The organization has two websites to inform interested
Florida
homeowners and condo owners:
News Website: http://www.ccfj.net/.
Educational Website: http://www.ccfjfoundation.net/.
We think that only owners can really represent owners, since all
service providers surely have a different interest! We are
trying to create owner-friendly laws, but the best laws are
useless without enforcement. And enforcement is totally lacking
in
Florida
!
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