CONDO CRAZE AND HOAS - WEEK 223

KAREN: GOOD AFTERNOON, AND WELCOME BACK TO CONDO CRAZE AND HOAS HERE ON 850 WFTL.  I’M KAREN CURTIS, AND I’M HERE AGAIN TODAY, AS WE ARE EACH SUNDAY AT NOON, WITH ATTORNEYS ERIC GLAZER AND SCOTT SHAPIRO FROM GLAZER AND ASSOCIATES, P.A.  A LAW FIRM PRACTICING COMMUNITY ASSOCIATION LAW THROUGHOUT FLORIDA.    AS OUR LISTENERS KNOW, WE ARE HERE EACH WEEK TO ANSWER ALL OF YOUR CALLS AND E-MAILS ABOUT THE ISSUES THAT MAKE LIFE IN YOUR CONDOMINIUM OR HOA ABSOLUTELY CRAZY FROM ONE MINUTE TO THE NEXT.

AS ALWAYS…………WE WOULD LOVE TO GET THE PHONE LINES GOING EARLY – ANSWERING ALL OF YOUR QUESTIONS – SO GIVE US A CALL RIGHT HERE IN OUR STUDIO AT: 877-850-8585 – AGAIN THAT’S 877-850-8585             

Or…………IF YOU PREFER TO E-MAIL US YOUR QUESTIONS……..YOU CAN DO SO BY VISITING THE SHOW’S WEBSITE AT CONDOCRAZEANDHOAS.COM AND BY CLICKING ON THE “E-MAIL THE SHOW” TAB   

ERIC:  and…………..even if you don’t want to send us an e-mail, you should still visit the show’s website at condocrazeandhoas.com where you can:

  1. A) LISTEN TO ALL OF OUR PAST SHOWS,
  2. B) SIGN UP FOR OUR FREE SEMINARS;
  3. C) AND SEE WHO THE SHOW’S SPONSORS ARE AND VISIT ALL OF THEIR WEBSITES
  4. D) AUTOMATICALLY LINK TO OUR FACEBOOK PAGE
  5. E) AUTOMATICALLY LINK TO OUR BRAND NEW HOA AND CONDO BLOG AT HOA-CONDOBLOG.COM– tomorrow’s topic – Everything you need to know about 55 and over communities.

 

  1. F) JOIN OUR E-MAIL LISTS AND GET COPIES OF OUR NEWSLETTERS AND OTHER ANNOUNCEMENTS ABOUT THE SHOW. IN fact, our new newsletter is out and it was sent to everyone on our list this week.  So make sure you are on our mailing list.

(let’s save this for when we come back from our SECOND  break)        

KAREN:  AND BY THE WAY………IF YOU HAVE A PRODUCT OR SERVICE THAT WOULD BE BENEFICIAL TO OUR LISTENERS, AND WANT TO BE A GUEST ON THE SHOW, ATTEND OUR MONTHLY SEMINARS WHERE YOU WILL MEET HUNDREDS OF DIFFERENT ASSOCIATIONS, BE LISTED ON THE SHOW’S WEBSITE AND HAVE A COMMERCIAL SPOT DURING EACH WEEK’S SHOW — YOU CAN BECOME A SPONSOR OF THE SHOW ——–JUST VISIT THE SHOW’S WEBSITE AT CONDOCRAZEANDHOAS.COM AND SEND US A QUICK E-MAIL

 

ERIC: AND OF COURSE – IF YOU WOULD LIKE TO CALL OUR LAW FIRM DIRECTLY AND PICK OUR BRAINS OFF THE AIR – CALL GLAZER AND ASSOCIATES AT 855-4-CONDOCRAZE AND VISIT THE LAW FIRM’S WEBSITE AT CONDO-LAWS.COM. AGAIN, THAT’S CONDO-LAWS.COM.

 

ERIC: Before we start, when one of our sponsors does great work we want to let our listeners know about it.  So…if you’re looking for a paint or stucco company you may want to grab a pen and paper………I just want to let everyone know that at my home, one of the outside walls, right outside my front door, was literally crumbling.  All the stucco was falling off the house – and it looked bad – like a serious problem — certainly way above my head and required much more than a paint brush to fix.  So – what do I do — I called one of our sponsors of our May 18th Hard Rock event, – PD Painting— and Daniel, the owner jumped on it.  He said they would be over on Monday — on Monday morning at 9am my doorbell rings and it was them.  And two nice gentleman worked on my home for hours — chipped out huge sections of stucco ——– and fixed it great — these gentlemen were real craftsmen.  And the job came out fantastic.  So…..all I can say is that if your home or condo is having painting issues or stucco issues…….PD Painting are the guys to call.  And here is their contact information…..Their telephone number is 888-416-3204, again 888-416-3204 and their e-mail address is www.pdpaintinginc.com  again that’s www.pdpaintinginc.com Make sure to let them know you heard about them on the show…and make sure to ask for Daniel.

 

KAREN: LAST WEEK WE STARTED THE SHOW BY GIVING EVERYONE A RE-CAP OF OUR BIG EVENT AT THE HARD ROCK — AND THEN, WE SPOKE ABOUT THE ASSOCIATION’S RESPONSIBILITY TO PREPARE YEAR END FINANCIAL REPORTS FOR ALL OF THEIR OWNERS …..AND WE REMINDED OUR LISTENERS THAT JUST LIKE ANY OTHER BUSINESS……..CONDOS AND H.O.A.s HAVE TO FILE TAX RETURNS TOO.

 

ERIC: And sure enough… people that live in HOAs were complaining that their HOA doesn’t prepare year end financial reports —– and they asked what they can do about it and — the only thing we could say is to file a lawsuit.  But if that same complaint comes up in a condo — the DBPR can certainly help out that condo owner.

 

SCOTT:  Well…..next year is not an election year…….and no matter who gets in…..perhaps we’re going to get that legislation passed that lets the DBPR help out homeowner associations too.  For $2.00 per year….trust me it’s a lot cheaper than having to file even a single lawsuit.

 

KAREN: IT WAS INTERESTING TO LEARN THAT — THE LARGER THE ASSOCIATION’S BUDGET IS —– THE MORE DETAILED OF A FINANCIAL REPORT THE UNIT OWNRS ARE ENTITLED TO. NOT EVERY ASSOCIATION HAS TO DO THE SAME THING.

 

ERIC: As we said last week…..there’s a compilation, review and an audit.  And of course the audit is the most thorough of the reports.  Now suppose however that an association is only required to do an review or a compilation …..but a new Board comes in and says….wait a minute… we don’t trust the last Board….so we want to do a more detailed report……we want to do an audit.  Can the Board just do that without asking the unit owners?  Remember, it costs a lot more money to do an audit.

 

 

SCOTT: In a condo — the answer is easy.  The Board can simply agree to provide a more detailed year end report and spend more of the owners’ money.  In an HOA though – it’s a little more complicated —and 20% of the owners must petition the Board for a more detailed report.

 

KAREN: SUPPOSE THE BOARD IS SUPPOSED SPEND A LOT OF MONEY NOW ON AN AUDIT — BUT THE BOARD SIMPLY REFUSES TO SPEND THE MONEY — AND THEY WANT TO DO A CHEAPER YEAR END REPORT?  CAN THE BOARD DO THAT?

 

ERIC: No — the Board can’t give the owners less than what they’re entitled to.   But….in both a condo and an HOA the unit owners can vote in favor of a less expensive less detailed year-end financial report.  But… they can only vote to do this for 3 years in a row and in year 4, like it or not, you must do that more expensive report.  So again….the Board can give you more than you’re entitled to in a condo – without a vote of the owners.  But, in both a condo and HOA the Board can’t give the owners less than what they’re entitled to without a vote of the owners.

 

ERIC: So….that’s about everything you need to know about your year end reports.  And most importantly, if you haven’t done it by now — you are late.

 

ERIC: Lots to talk about on the show today….let’s take our first break of the hour and when we get back, we’ll tell you about a story we have wanted to talk about for a while, but keep running out of time, and it’s about a new law that requires you to vote “NO” regarding your amendments to your declaration…..and if you don’t…..guess what….you just voted “YES” — even if you didn’t vote at all.  And of course, we’ll take all of your other calls and e-mails on anything and everything else in the world of condos and HOAs — just give us a call here in the studio at 877-850-8585.  We’ll be back right after this.

 

SCOTT: OK.  About a decade ago, in a case called Woodside v. Jahren, The Florida Supreme Court ruled that as long as the requisite number of unit owners in the condominium agree to amend their declaration, the condominium association can now prevent the rental of units in the condominium.  However…..Justice Quince at the time thought that this was unfair to a unit owner who grew accustomed to renting out their unit.  She urged  The Florida Legislature to do something to protect what she thought was a valuable property right going forward.

 

ERIC: So, as a result, The Florida Legislature passed a statute that says, if the association passes an amendment that now limits the right to rent your unit, it does not apply to you unless you specifically vote in favor of the amendment, or it will only apply to your home when you sell it to the next owner.   And this has worked well. Again, the new rental restrictions would not apply to you unless you SPECIFICALLY voted in favor of the rental restrictions.  Well, NOW here comes Representative Moraitis, and he now files a bill that says — we’re going to change that.  From now on, when the community takes a vote to prevent rentals, the rental restrictions will apply to you, unless you specifically vote against the amendment, and even if you decide not to vote at all.

 

 

KAREN: BUT SUPPOSE YOU’RE OUT OF TOWN WHEN THE VOTE IS TAKEN — OR THE ASSOCIATION LOSES YOUR VOTE?

 

ERIC: Well, when you get back from your vacation, you may now be told, sorry, you missed the opportunity to vote against the amendment, so when your current lease with your tenant is up—– you can’t rent your unit any longer and has to get out.

SCOTT: and believe it or not—– associations are known to lose a document every now and then —- SO EVEN IF YOU DO VOTE AGAINST THE AMENDMENT —- BELIEVE ME — ONE DAY YOU MAY BE TOLD THAT YOU DIDN’T —— AND NOW YOU HAVE TO GET YOUR TENANT OUT BECAUSE THE RENTAL RESTRICTION APPLIES TO YOU.

 

 

 

ERIC: It just makes no sense.  There’s no justification for it.  In fact, if the association knows that it has the votes needed to amend the documents — maybe it’s in their interest to DELIBERTELY not mail a ballot to those people they believe won’t vote in favor of the amendment, and these people won’t even get the chance to vote against it —– and if you think it can’t happen, it will.  And Scott —- if our listeners don’t believe that documents sometimes disappear — let me remind them that many association governing documents speak about that certain document called “the original assignment of parking spaces list” from the developer. I don’t think I ever met an association that has it.  But here we have a perfect example of The Florida Legislature trying to fix something that isn’t broken while they let broken things stay broken.  Unreal.  This is dangerous….and mark my words….there will be future lawsuits whjere the association will try to stop someone from renting…and the person will either say they voted against the amendment and the association lost it…..or that they were simply never asked to vote on the amendment in the first place.

 

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ERIC: Interesting article in the paper the other day about “boomerang buyers.”  So…..what is a boomerang buyer……..someone who basically lost their home one way or another during the foreclosure crisis…but has now boomeranged back and is eligible all over again to qualify and buy another home.

 

KAREN:  TYPICALLY….FANNIE AND FREDDIE REQUIRE SOMEONE WITH A PREVIOUS FORECLOSURE TO WAIT 7 YEARS BEFORE QUALIFYING FOR A NEW MORTGAGE ——— BUT YOU’RE ACTUALLY IN BETTER SHAPE IF YOU FILED A BANKRUPTCY BECAUSE THEN…. THE BORROWER ONLY HAS TO WAIT 4 YEARS BEFORE QUALIFYING ALL OVER AGAIN.

 

SCOTT: And someone who had to get rid of their home in a “short sale” has to wait only 2 years before getting another Fannie or Freddie Loan.  And anyone seeking an FHA loan can qualify after only 3 years after a foreclosure and short sale.

 

ERIC: There’s even another program now for owners who lost a home because of at least a 20% cut in pay—– that’s called FHA’s Back to Work Program.  Now some boomerang buyers have to put down payments of 20% —- but some of these programs offer the ability to put down as little as a and a half percent or 5 percent.  So……..just when the foreclosure crisis starts getting a little better……..we have all these programs out ……..again…… which are going to potentially allow people to purchase homes they can’t afford……….and in my mind I’m thinking………prices are going up again……..people are going to be taking out equity lines again……..and forget “boomerang buyers” —- it’s going to be “boomerang foreclosure crisis” all over again.

 

SCOTT: I have no problem saying that it would be great if everyone lived in a nice big house with a pool and a white picket fence ——— but You would like to think that the banks and/or the federal government now has new measures in place that would prevent people from buying homes they can’t afford — so that we don’t suffer through yet another real estate collapse.

 

KAREN: WE HAVE HAD THIS DISCUSSION A FEW TIMES ON THIS SHOW —— THERE ARE SOME PEOPLE OUT THERE WHO WERE SO BURNED IN THE REAL ESTATE CRASH OVER THE LAST FEW YEARS —– THAT THEY DON’T WANT TO BUY AGAIN —– EVEN IF PRESENTED WITH THE OPPORTUNITY — THEY WOULD RATHER RENT.

 

ERIC: All I’m saying is……..I’m looking at what’s going on……… all kinds of programs are out there again apparently encouraging people to buy homes…..prices are rising………the job market is stagnant….. and this may be a recipe for a boomerang crash.  History repeats itself….but let’s hope that in this case – I’m wrong.  But, I would like to know what our listeners think?  Should everyone be able to buy a home?  Do you think the real estate crash can happen all over again?  And….if you have been burned before…..are you even still interested in purchasing a home should you have the opportunity?  Give us a call here in the studio at 877-850-8585.

 

ERIC: We all know that in both a condo and an HOA board members serve without compensation.  Suppose however that a member of the Board owns a business and that business wants to enter into a contract with the association?  For example, let’s say the condominium needs a paint job.  The condo President is a general contractor and his company is qualified to do the work.  The President tells the other Board members that the association should hire his company to do the job because he will give them the best price, he will personally supervise the job, he will provide the standard warranties and his company is licensed, insured and will pull the proper permits.  Can the Board vote to hire the services of the company owned by the association President?  Scott…..what’s the answer? 

 

SCOTT: The answer is “Yes” but only if certain legal hurdles are accomplished first.

 

Both Florida condominium and H.O.A. law would allow the association to enter into this agreement with the President’s company.  First however:

 

(a) The association shall comply with the requirements of s. 617.0832, meaning the contract and the relationship must be disclosed;

(b) The disclosure shall be entered into the written minutes of the meeting.

(c) Approval of the contract or other transaction shall require an affirmative vote of two-thirds of the directors present.

(d) At the next regular or special meeting of the members, the existence of the contract or other transaction shall be disclosed to the members. Upon motion of any member, the contract or transaction shall be brought up for a vote and may be canceled by a majority vote of the members present. Should the members cancel the contract, the association shall only be liable for the reasonable value of goods and services provided up to the time of cancellation and shall not be liable for any termination fee, liquidated damages, or other form of penalty for such cancellation.

 

ERIC: I know that some of you may think it’s simply a bad idea to hire the services of a company owned by one of the directors.  I can’t say I agree.  If the Board member’s company is reputable, the association is getting a good deal and the statute is complied with, perhaps it can work out well for the association.  I would love to know if any of you had positive or negative experiences in this regard.

 

KAREN: LET’S FIND OUT WHAT OUR BLOG READERS HAD TO SAY:

Laura said:

I had a similar situation at my HOA but it was for providing a web site, which is slightly different. We were paying a board member’s husband to develop and maintain a web site. We were paying between $280 and $300 per month and getting approximately 8 hits per month. The site was asthetically very nice, but the documents were cut off.  You could send an email request, but couldn’t discuss issues with other members or get information about your account or the associations accounts. When I offered to improve the site for free, I was denied. The board members were friends with this couple and they did not want them to lose their income, even for a better web site.

 

ERIC: that is a bad story of the Board members worrying about protecting their own first and potentially not acting in the best interests of the community.    Score one for not doing business with a director.

 

ERIC: Nila Ridings said:

We got a double whammy. The board president completely renovated the clubhouse; new kitchen, baths, wood flooring, window treatments, pool furniture, and fabricated a “decorating business” which she claimed did the work. This was never up for bid. Years after the newsletter had been published with paid advertisers we learned during a jury trial this same board member was also the “publisher” of the newsletter.   This “publishing company” was depositing their fees directly into the board president’s personal banking account. Even odder, the state has no record of this board member ever owning a decorating or publishing business! Never of these two situations were ever put out for bid…they just “conveniently” fell right into the hands of the board president while eight other board members went along with it. As far as I’m concerned I think if somebody wants to do business with the HOA, resign from the board and after 90 days you can submit your bid for approval.

 

ERIC: Now I know Nila is from Kansas —- and maybe those types of shenanigans goes on in Kansas — but this is Florida —- there are no scammers here.  Every association complies with the law here and every one of us are decent hard working, law abiding honest citizens.   And in Kansas it all started with The Wizard of Oz – you remember how he scammed Dorothy, The Tin Man, The Lion and The Scarecrow?

SCOTT: Ulises said:

I don’t see a reason why the association should pass up a good deal, as long as all is handled appropriately. It can be a WIN WIN for all involved… 

 

ERIC: and that is the point I was trying to make.  It can be a win win.  And…if it’s handled above board….it’s certainly no greater risk than doing business with any other company.  However……I would not want the Board member signing checks to their own company.  That would bother me.  I still want the other Board members to ensure that the director’s company is only getting exactly what the association agreed to pay and not a penny more…and that the association isn’t suddenly paying increased amounts for unexpected things and cost overruns.  It is incumbent upon the other directors to make sure that the company owned by their fellow Board member is performing under the contract — and if they aren’t, to fire them or warn them appropriately.

ERIC: Let’s talk about a topic that drives some owners in community associations absolutely nuts — and that is whether or not their Board of Directors is allowed to borrow money on behalf of the association rather than pass a special assessment to pay the bills.

SCOTT:  Well as we know, Each year your condo association or HOA is required to pass an annual budget that in theory should pay all of the bills of the association.  But then a storm hits, or balconies start deteriorating and many Associations suddenly find themselves in desperate need to repair the common areas with no reserve funding to rely on.  But…..Rather than pass a huge special assessment and force everyone to instantly dig deep into their pockets, many associations turn to banks for a loan.

 

ERIC: And The question is…is there anything in the condominium or HOA statutes that would prohibit this.  And In simple terms, the answer is no.  In fact, borrowing money is expressly authorized in the Florida not-for-profit corporation statute.  So, unless there is a specific restriction in your governing documents that prohibits the Board from borrowing money, there really are no restrictions.

When borrowing money from a bank, the association will be required in the loan documents to pass a special assessment in an amount sufficient to fund the repayment of the loan, or promise to include the debt payments in the annual budget.  Several years ago, The Director of the Division of Florida Land Sales, Condominiums and Mobile Homes issued a Declaratory Statement that allows Condominium Associations to permit owners the option of paying the special assessment in full without interest or paying the assessment with interest over time.   The decision does not say the association must offer the option, only that it may offer the option.

 

KAREN: WE ASKED OUR BLOG READERS: Has your association borrowed money from a bank?  Was it a good idea, or did it turn out to be a long-term drain on the resources of the community?

 

DEBBIE GUEST SAYS: Our board can borrow money. It has in the past, and one of the owners/board members works for a bank and in the past has helped us. Our board was responsible enough to pay it back, and quickly. Our board also can special assess. Over the past 10 years, our board just adds up their budget — sometimes with extras for the board members to play with — and just charges an extra $100 assessment or whatever they need that year. They feel they can just work off the budget, not complying with our Declarations or any other laws governing assessments. 

ERIC: Hbosch said:  It is best to ask the Condo owners if any of them want to lend to the Condo. Do a promissory note, pay it back over a year or so. They make more money than depositing in bank, and condo pays less than borrowing from bank.  What do you think Scott?

SCOTT: As long as this is disclosed at a Board meeting, the rate is good, the terms are fair, there is nothing that says the money must be borrowed from a bank.  If it’s a good deal for both sides….there’s nothing wrong or illegal about it.

 

SCOTT:  Michelle said:

Never borrow money. We are more in debt than we started. A $23,000 loan has grown to over 100,000 with no end in sight. The attorney that works with them ripped us off and then quit. We are a small 36 unit condo. If anyone would like to write a book about this condo in this day and age it would be a best seller

 

ERIC: anonymous said:

We bought a condo in a small building where  most OF THE units were in foreclosure. A few of us have fixed the place up to an acceptable level by cutting costs and doing work ourselves. Most of the building is now occupied, but mostly by renters. Because of this, it is almost impossible to get a loan from a local bank. A new roof will be needed soon. There are no reserves and maintenance fees are low and will likely go up and soon. The budget needs will likely be in the thousands and with no bank lending, is an assessment the only way out?  If no bank loan, will an equity line of credit be the answer to our dilemma?

 

A couple of problems in this condo — first, a bank may not lend if many of the units are renter occupied.  There’s no reserves, yet a new roof is needed.  And, there’s an admission that the maintenance is too low.  Well to start….how about passing a realistic budget that includes reserves?  This isn’t magic……if assessments are too low and the bank is probably not going to lend—– yes you will be looking at a huge special assessment in the not too distant future.

 

SCOTT:

ANONYMOUSE WRITES IN AND SAYS: If your reserve account has the money in it, why not just change your reserve fund from a straight line to a pooled reserve account?

 

ERIC: To remind our listeners…..reserve funds in a straight line account can only be used for the specific line item for which they are reserved.  For example, if you are reserving for the roof, you can’t use those funds for a plumbing job that suddenly comes up.  So… Anonymous is suggesting that if you have this money….you vote to switch to a pooled reserve account where you can use those reserve funds for any category of reserves.  And that may provide a temporary patch…..until you borrowed the roof funds and a year later you need a new roof.

 

KAREN:  Nila Ridings from Kansas said:

Our former property manager used dues to pay off old debt (500 THOUSAND DOLLARS) and then convinced the board to borrow $1,000,000 (one million) Of which he got 10%, $100,000 off the top for “managing” the million dollars. It was entirely spent in one year. The HOA could not afford the payments, so they paid interest only for 12 months. Another $60,000. Now, they are making payments of principle and interest. I’ve calculated IF it’s ever paid off the total cost with interest will run over $2M. I say IF because it’s a line of credit not a loan. They can pay it down and re-borrow. All without the vote or approval of any kind from the homeowners! What did they do with the money besides line the pockets of the property manager? THEY BOUGHT PAINT TO PAINT THE HOUSES! By the time the million dollars is paid off, if ever, it will be long past the time the next paint job is due!

ERIC: Who would think that stuff like this goes on in our nation’s heart-land — Kansas of all places.  First thing is…..why did that manager get $100.000.00 — Enquiring minds would certainly want to know more about that transaction.  But Nila raises a good point.  Lots of associations borrow money or open up a line of credit an swear only to use it in an emergency.  But just like everyone does with their credit cards ……they use that line of credit for everything and anything that comes up, instead of including those expenses in the budget.  You know….much like ho the government works.

 

 

 

 

 

 

 

 

 

E-mails

KAREN: HERE’S AN E-MAIL FROM MIKE IN WEST PALM BEACH  AND MIKE SAYS: OUR BOARD IS CALLING A SPECIAL MEETING TO DISCUSS PERSONNEL REPLACEMENT (OFFICE STAFF). CAN WE LIST THIS AS A CLOSED MEETING, DUE TO THE SENSITIVE NATURE OF WHAT IS TO BE DISCUSSED? 

ERIC: Yes you can Mike.  A few years ago the statute was amended to allow for closed door meetings if personnel matters were to be discussed.  Certainly, replacement of office staff falls into that category.  You may ask why does the Legislature allow these meetings to be behind closed doors, and the answer is simply that if an employee is doing a bad job, the Board shouldn’t have to air their dirty laundry in front of the entire community.

 

ERIC: Question from the owner:
Our ballot has three slots and four candidates.

May members vote for only two and have a valid ballot?
Can the board invalidate the whole ballot if only two votes are cast?

 

ERIC: As I say all the time here on Condo Craze and HOAs —- we are truly blessed to have some wonderful sponsors of the show — who really make it possible for our listeners to hear us each week and attend our educational events.  And one of those wonderful sponsors is with us today in the studio — and it’s a new sponsor – CITY NATIONAL BANK.  And from City National Bank we have Greg Managram and Jeffrey Mariner.  Welcome gentlemen and thanks so much to City National Bank for becoming a sponsor of the show.

 

RESPONSE:

ERIC: Tell our listeners a little bit about City National Bank and specifically what each of you do there.  Where are your branches located

 

RESPONSE:

ERIC: I have to tell you……there is definitely a perception out there that the banking industry is just not as personal as it once was.  People always knew their branch manager by first name — if they had a problem, they could come in and take care of it face to face.  Now, many people feel that if they have a problem, they have to call customer service and dial “1” for deposits, “2” for withdrawals, “3” for English — and associations are really looking for a more personal relationship with their bank.  How does City National Bank try to prevent customers from feeling lost?

RESPONSE:

ERIC:  Let’s talk about some of the very specific services that you can offer associations and we can start with checking accounts and maintaining reserve accounts.

RESPONSE:

ERIC: What about the ability for City National Bank to receive the monthly or quarterly assessments from the unit owners directly and keep track of who paid and who didn’t?

 

RESPONSE:

ERIC: Let’s talk about what so many associations really want to hear — how do they get their hands on a big fat loan from City National Bank?  Lots of associations are now facing 40 year recertifications that can be really expensive — many are faced with massive construction or balcony restoration projects — and many of these associations never bothered to fund a reserve account.  So —they’re broke.  They don’t want to pass a special assessment and a bank loan may be the only option.

 

RESPONSE:

ERIC: Over the last few years — and even today — the rates have never been lower — and borrowing money really is not a bad idea.  But I have to tell you…….some banks over the last few years are so afraid of getting burned again that they have made lending to associations almost impossible.  For example — I’ve heard that some banks won’t loan to an association if more than 5% of the units are delinquent.  I have to tell you that it today’s day and age — if an association only has a 5% delinquency rate — that’s outstanding.  So my question is…..while these loan programs may be out there – is it impossible to qualify for?

 

RESPONSE:

ERIC: I want to change course for a moment.  It seems like week in and week out on this show we unfortunately talk about associations that get stolen from by either their management company or by Board members directly.  From the bank’s perspective — what tips can you give our Boards out there and unit owners to make sure they don’t get stolen from or even become a victim of identity theft?

RESPONSE:

ERIC: If some Boards out there need some money or have questions with what to do with their existing money and they want to get in touch with City National Bank — how should they get in touch with you guys?  (Give phone numbers and web site addresses)

RESPONSE:

ERIC:  Gentlemen: I really want to thank each of you for being on the show today and I really want to thank City National Bank for being a sponsor of the show.

RESPONSE:

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