From manicured lawns to well-maintained amenities, residing in a HOA community can be a fulfilling experience. However, this residential experience comes at a cost. HOA residents must pay monthly or annual fees for regular maintenance and repair costs. These charges are numerous, and understanding them can be complicated for homeowners and board members. This guide highlights the differences between HOA assessment vs. dues to help HOA members know what they are about.
HOA Assessments Explained
HOA neighborhoods are renowned for their affluence and high quality of life. However, they are not exempt from emergencies. When disaster strikes a particular area, it affects all neighborhoods, including HOA communities. Here’s where HOA assessments come in.
An HOA assessment is a one-time fee charged to HOA homeowners to cover unexpected repair and maintenance costs. It comes in handy since repairing damages caused by natural disasters and other emergencies can be too expensive for regular HOA fees to cover.
HOA Dues Explained
Maintaining amenities and facilities in an HOA neighborhood costs money. HOA residents must pay regular monthly or annual fees for repair, maintenance, and upgrade costs. These fees are what we call HOA dues.
HOA board members calculate HOA dues at the start of a financial year. The treasurer prepares a budget based on proposals from members. The board then ratifies the proposals with HOA residents expected to pay their dues for the upkeep of the community. Failure to comply might lead to fines.
HOA Dues vs. HOA Assessments: What Is the Difference?
HOA dues and assessments might have striking similarities. In any case, they are all fees imposed on HOA members.
While HOA dues are regular payments used to cover HOA maintenance costs, HOA assessments are a one-time fee for emergencies. The board calculates HOA dues every financial year, with homeowners expected to pay monthly or annually.
In contrast, HOA assessments are usually a last resort if the HOA does not have adequate funds for unexpected expenses. The board will first consider other alternatives. After exhausting all options, it will turn to HOA assessments to cover the costs. All homeowners must comply since special assessments are in the HOA’s governing documents.
Managing HOA Fees vs. HOA Assessments
Inaccurate projections and budget miscalculations can result in a shortage of funds, forcing the HOA board to impose a special assessment fee on members. There’s nothing HOA members can do other than comply. Enlisting an HOA accounting service in Sandy Springs can help your community appropriately calculate and manage HOA fees and assessments. Contact Abel Accountants for assistance in managing HOA dues and assessments.
