Homeowners associations (HOAs) are volunteer-run organizations that oversee the homes in distinct communities. While HOA boards lead homeowners associations and those who live in their communities, they don’t always have the time to tackle community management work, such as collecting fees, performing maintenance, and so on. That’s where HOA management companies can help.
Billing and Collections Services
HOA management companies frequently handle billing and collection services for the boards that employ them. These services can include:
- Billing residents for HOA fees
- Tracking down any late or delinquent payments
- Issuing bill-related notices to residents
Bill Residents for HOA Fees
All HOAs have fees associated with keeping meetings, maintaining grounds, and paying for property management companies.
Depending on how the contract for the homeowners association is set up, those fees could be sent to a third-party escrow account, and the HOA management company collects the money from that account each month. Alternatively, homeowners in the HOA may be required to send checks directly to the management company or to the front office.
However it’s done, the HOA management company is responsible for:
- Tallying how much money it is owed each month
- Collecting the money from the homeowners
- Making sure that homeowners understand how much money they owe
Note that this is not the same thing as rent collection, which is an important responsibility of standard property managers who oversee rental properties. HOA management companies only collect money for their services—usually $10-$20 per unit per month.
Track Down Late/Delinquent Payment
For example, a homeowner might have their mortgage on auto-pay so they don’t have to think about it and won’t accidentally miss a payment. However, this might mean that they forget to pay their HOA fees.
If this occurs, the HOA management company is responsible for contacting that homeowner and securing the late payment ASAP. They can do this in a variety of ways:
- Send an email of the violation
- Leave a written notice at the property
- Visit the property to collect payment
Issue Notices to Residents
From time to time, homeowners associations may have problems with residents refusing to pay fees. If this occurs, the HOA management company will issue notices to residents and take care of any billing disagreements or discrepancies.
For instance, a resident in an HOA community might think they don’t need to pay the monthly HOA fee for one reason or another. Maybe they recently moved in or maybe they are planning to move out before the end of the next month. Whatever the situation might be, the management company should speak to those residents and settle the matter in whatever way works best.
By putting the power of billing and collection services in the hands of HOA management companies, HOA boards or members don’t have to worry about these elements, nor do they have to compromise the friendliness of their community. Delivering a late payment might feel a lot different to a delinquent resident, for example, if the collector is their neighbor rather than a third party, like a management company.
Accounting Services
HOA management companies take care of most of the accounting work inherent in running a homeowners association. This work can include services such as:
- Managing and reconciling accounts
- Preparing and distributing accounting reports to HOA board members and residents
- Offering budget advice to HOA board members
- Monitoring and maintaining reserve accounts for repair fund purposes
Manage and Reconcile Accounts
Managing and reconciling accounts includes:
- Standard bookkeeping practices, like tracking incoming payments and expenses
- Making sure that recorded expenses match money exiting the accounts
- Accounting for all monetary transfers, especially when it comes to collections
To do this, an HOA management company might hire a dedicated accountant. But in many cases, an office receptionist or some other employee handles the bookkeeping work.
Note that managing and reconciling accounts also involves maintaining strict, accurate records. An HOA management company may have records for multiple HOAs or communities depending on how many they oversee. In any case, an HOA board member might need records for monthly fun spending—they can usually contact an HOA management company employee for that information.
Prepare and Distribute Accounting Reports
HOA management companies handle the preparation and distribution of accounting reports. These reports are typically delivered to HOA board members, which include the community residents who handle the majority of HOA decisions and oversight work.
However, some HOA management companies may also give accounting reports to residents who request them. For example, if a resident wants to know how the HOA fees are being spent, they might request a record of that accounting information from the management company. This ensures that they don’t receive any information falsely doctored by HOA board members and that every HOA resident has the option to see exactly where their money is going.
Offer Budget Advice
HOA management companies frequently offer budgetary advice to HOA board members, who may not have as much experience handling finances.
Note that HOA board members do not necessarily need to listen to the budget advice offered by their management companies. But depending on the specifics of a contract with a management company, the board may have to listen to the budgetary recommendations of their managers rather than the reverse.
Monitor and Maintain Reserve Accounts
Reserve accounts can be used for a variety of purposes, including:
- Repair funds
- Inspection fees
- Hiring and training employees
- Covering HOA fees if the community has an exodus of members and doesn’t bring in as much money as it normally does
These repair reserve accounts are normally agreed upon before the HOA management company begins work. That way, the company and the community residents all know what the reserve accounts are for and how much money they need to maintain at all times.
Rule Enforcement
One of the most important responsibilities of any HOA management company is enforcing community rules. This responsibility can include services like:
- Visiting the community regularly and patrolling it to ensure compliance
- Spotting and fixing violations
- Sending violation notices to homeowners
- Taking complaints or notes of violations from homeowners
- Following up with homeowners to ensure rule compliance
- Answering homeowner questions about HOA community rules
Visit and “Patrol” the Community
Many HOA management companies don’t oversee one homeowners association and its residents. Instead, they oversee many communities. To do this, they may deploy several employees to patrol the streets of those communities to check for things like:
- Trash and other sanitary violations
- Broken things in need of repair
- Obvious violations of community policies
Specifically, HOA management companies need to be knowledgeable about any given HOA “CC&R” or covenants, conditions, and restrictions. That means the management company needs to know what the HOA dictates in terms of things like shrub length, types of lawn grass, and where cars can be parked.
If an HOA employee spots a violation, it’s their duty to report and/or take care of the issue. These regular patrols also help to alert community members to potential hazards or threats. For example, if a wild animal like a wolf is noticed in the neighborhood, the HOA management company employee should send out a notice to all the residents to keep their dogs indoors for a while.
Spot and Solve Violations
An HOA management company is responsible for spotting and solving any community policy violations.
For example, if a resident fails to maintain their front yard to community specifications—in terms of grass length, tree trimming, or something else—the HOA management company needs to take care of the problem if the resident cannot.
Some HOA communities place these duties explicitly in the hands of their management companies so it’s not up to the residents. For instance, if a tree has grown to be too large and its branches extend into a neighboring yard, the HOA management company may be responsible for hiring an arborist to trim the branches safely and carefully, or may be responsible for tackling the work itself.
Send Violation Notices
In theory, the HOA management company simply notifies the resident about the violation, the resident then solves the violation, and everything goes on smoothly. If the resident refuses to fix the violation, the HOA management company is then responsible for convincing them to change their mind or doing the work itself.
For instance, if an HOA resident refuses to pick up garbage in their front yard, the HOA management company may simply fine them and pick up the litter instead. The fine is intended to compensate employees for labor and to penalize the homeowner so they don’t continue the behavior.
Take Complaints/Violation Notes
If a resident notices a violation from one of their neighbors, they may write a notice to inform the rest of the community and to use social pressure to fix the problem. The HOA board may receive a copy of the note as well, but the management company is the organization primarily responsible for making sure the issue is fixed promptly.
Most HOA management companies maintain records of resident violations or complaints against them for the purposes of potential evictions. If a resident is repeatedly shown to be a problem in the community, for example, the HOA management company may use those repeated incidents as ammunition to evict them or get them to change their behavior.
Follow Up with Homeowners/Ensure Compliance
HOA management companies must follow up with homeowners if they were previously the subject of a violation notice or complaint and ensure future compliance regarding homeowners association rules.
This is an important duty because some homeowners association residents are unaware of their violations or don’t fully understand community rules, especially when they first arrive. For instance, a new homeowner might not know how their bushes should be trimmed or maintained.
In this way, HOA management companies are somewhat about helping HOA communities work and stick together. They’re helpful for maintaining the community spirit and feel of a neighborhood compared to management companies for traditional rental properties, like apartment complexes.
Answer Questions About Rules
HOA board members may also receive questions about rules. But many rules are implemented because of HOA management policies—for instance, community members may be forbidden from performing certain types of yard work due to perceived risk. The HOA management company should take care of that work instead.
HOA management companies and their employees should be prepared to answer resident questions whenever they crop up. Some management companies may have online portals or email addresses through which residents can send their questions for organizational purposes. That way, a dedicated office agent can answer questions from residents quickly and comprehensively, as well as carry on long-term conversations with residents if needed.
Maintenance Services
HOA management companies usually tackle a host of maintenance jobs for their communities, such as:
- Cleaning common areas and shared recreational facilities
- Performing groundskeeping work for outdoor areas
- Fixing issues in the common areas
- Fixing some maintenance problems experienced by homeowners
- Coordinating with third-party vendors and contractors
- Negotiating vendor contracts and finding new vendors when necessary
Keep the Common Areas Clean
HOA management companies are the chief agents responsible for keeping common areas in homeowners association communities clean.
This work can include:
- Picking up trash around the area, both inside and outside
- Making sure that office buildings or shared buildings look good (e.g., cleaning windows, cleaning doors, vacuuming carpets)
- Fixing any issues with common areas, especially recreational facilities
For example, if an HOA has a community pool, the management company is responsible for making sure that people use the pool properly, it’s covered in winter, it’s cleaned in spring, and chlorine levels are regulated.
Many HOAs take pride in their common areas and shared recreational facilities, like arcade rooms, gymnasiums, pools, etc. Their management companies make sure these places look good and are usable for residents at all times. If there’s a problem with one of the common areas, like an office or recreational spot, residents can submit a complaint to the management company to alert maintenance staff to the issue.
Perform Groundskeeping Work
Groundskeeping work includes:
- Sweeping the sidewalks
- Picking up dog poop and making sure that dog poop bags are supplied to residents by disposal sites
- Taking care of seasonal groundskeeping tasks, like blowing leaves, shoveling snow, and spreading salt on the roads after a snowstorm
- Maintaining community greenery, like shrubs, bushes, and trees
If there’s a groundskeeping problem, residents are usually encouraged to bring the issue to the attention of the HOA management company rather than the board. Again, this helps to streamline maintenance requests and prevents the board from becoming overwhelmed with basic problems.
Fix Common Area Issues
For instance, if a piece of gym equipment breaks at the shared gymnasium, the HOA management company should place an order for a new piece of equipment as soon as possible. They’re also responsible for telling residents that the gym equipment is broken, usually by putting a note up on the broken equipment.
Fix Limited Homeowner Amenities/Repair Problems
Some full-scale HOA management companies also handle in-unit amenities and repair requests, at least to a limited extent.
For example, if a homeowner has a problem with their dishwasher, the management company’s maintenance staff can take a look at the unit and try to fix the problem. Depending on what the problem is, the maintenance staff may fix it, order a new unit, or contact a third-party contractor (like a plumber) to do more work.
In any case, homeowners submit maintenance requests for in-unit repairs rather than communicating with the HOA board.
Coordinate with Vendors and Contractors
Vendors and contractors can include companies and individuals who perform duties like landscaping work and common area maintenance. For example, if your HOA requires an arborist to come to maintain the trees after a rough winter, your HOA management company can help you negotiate a contract with the arborist company.
Some full-scale HOA management companies can even solicit competing bids from vendors to drive down the overall price your association has to pay. If your management company handles most of the day-to-day operations in your community, they may further act as the primary point of contact for vendors (leaving your HOA board to focus on other matters, like community management).
Negotiate Vendor Contracts and Find New Vendors
If there’s a problem with a current vendor or contractor, your HOA management company can negotiate with them to resolve the situation or find a new vendor or contractor for your needs.
This ties into the above service, and it’s beneficial if your HOA board doesn’t include any members who are skilled at contract negotiation. Note that only the most comprehensive, full-service HOA management companies will provide this work to you. Otherwise, your HOA board members will be responsible for finding contractors and vendors to suit the community’s needs.
Risk Reduction Services
HOA management companies are often responsible for reducing or eliminating risks in HOA neighborhoods. Reducing risks includes tasks like:
- Fixing known safety hazards personally or by contracting the work of a specialist
- Notifying current residents of risks they should avoid
Fix Safety Hazards
For example, an HOA employee might drive around and notice a piece of debris in the road that could be a hazard for drivers. They’ll remove the debris and clean up the community in the process.
Note that most HOA management companies aren’t responsible for fixing safety hazards that require the work of a specialized contractor. For instance, if a power cable goes down in the neighborhood, either the HOA board or the management company will need to call licensed electricians to handle the problem.
Notify Residents of Current Risks
In addition, HOA management companies frequently notify residents of current risks (provided that they are full-service companies).
For instance, if a company knows that there’s a possibility for incoming flooding or freezing, they might send out a notice to community residents. However, HOA boards may also have this responsibility; it depends on the details of your contract with the management company in question.
Administrative Services
HOA management companies often provide a variety of administrative services for HOA boards. They may:
- Coordinate board meetings and take minutes to record events
- Handling communications with residents
- Maintain and organize HOA paperwork
- Oversee and advise the HOA board or community on proposed architectural changes
- Organize community events
Coordinate Board Meetings and Take Minutes
Most homeowners associations have regular meetings with board members and volunteers. These serve as opportunities to voice concerns, generate consensus regarding community guidelines and rules, elect new board members, and secure volunteers for upcoming community initiatives and events. During these meetings, there might be a lot of information, many people might speak, and there may be many conflicting opinions.
HOA management companies frequently take minutes during these meetings so that board members later know who said what and so there’s an accurate record of suggestions, complaints, and recommendations from community members.
Furthermore, HOA management companies often help to coordinate board meetings. They may send out potential meeting times to the community members or they may announce upcoming board meetings once those meeting dates and times have been decided by the boards themselves.
In any case, HOA management companies are valuable administrative assistants to many HOA boards. Management companies may send one or two employees to these meetings to accomplish all necessary work.
Handle Communications with Residents
HOA management companies may handle communications with residents regarding board policies, initiatives, or meeting decisions.
Not every community member can attend every meeting—to ensure that everyone in the community is kept up-to-date regarding guidelines and policies, HOA management companies may be responsible for communicating meeting decisions promptly.
For instance, if the HOA board decides to enact a new curfew policy for music and backyard policies, their management company should send out a memo to all the community members so everyone knows about the new policy. This minimizes accidental violations and discomfort among community members.
Maintain and Organize Paperwork
As part of their administrative duties, HOA management companies frequently maintain and organize paperwork, particularly paperwork that pertains to board meetings and events.
If a board member has a question about a previous meeting and what was said in it, they may petition the management company for records of that meeting.
If the HOA management company is remote or otherwise limited in its duties and responsibilities, the records will likely be digital. If the management company maintains an on-site office and/or manager, the records will probably be physical to some extent.
Oversee and Advise on Architectural Changes
When this occurs, HOA management companies may oversee and advise community members on architectural changes depending on their experience.
For instance, if the community wants to erect a new fence around the neighborhood, their management company might:
- Make an estimate for how much fencing will be needed
- Make an estimate for how much the fencing will cost
- Help the community members understand what it will take to maintain a good fence
However, this service is contingent on the HOA management company being a full-service organization that has a lot of experience in this area already. If the HOA management company for your community also handles community budget affairs, that company may further be able to advise your community members on budget concerns regarding architectural changes.
If a resident has a question about community policies regarding property modifications, an HOA management company or its staff may be able to answer questions about those modifications. For instance, if a resident wants to know whether they can make a change to their driveway’s shape or size, the management company should be able to tell the resident one way or another.
Organize Community Events
Not all HOA management companies perform this service, as it is usually left up to HOA boards and volunteers. However, if your management company is a big part of your neighborhood, they may play a role in planning or spreading the word about community events.
For instance, your HOA management company may send out memos or help you organize documents for an upcoming event. But note that HOA management companies don’t normally run community events no matter their size; that work is reserved for HOA volunteers and community members themselves.
Additional Services
In addition to the above services, HOA management companies may provide additional benefits to HOAs, such as:
- Offering legal advice
- Marketing HOA homes to prospective homebuyers
Offer Legal Advice
Some HOA management companies have legal experience and in certain situations can provide limited advice.
Depending on the size and sophistication of a given HOA management company, they may also have one or more lawyers in their employ. If this is the case, you may be able to ask your management company for legal advice regarding things like HOA policies, resident acceptance rules (under the Fair Housing Act), and so on.
Market HOA Homes
The most comprehensive HOA management companies may help homeowners association boards market homes in their communities. This can help bring new residents into the community and replace departing members quickly.
Depending on what the HOA management company offers, this marketing assistance can include:
- Creating marketing materials for the HOA, like posters or online advertisements
- Helping HOA board members list properties on real estate websites
- Connecting homeowners association boards with realtors and prospective homebuyers
However, note that HOA management companies do not fully take charge of property marketing or real estate services. That’s outside their domain—you’ll likely need to contact a dedicated real estate office or agent for more assistance in these matters.
Service Differences Between HOA Management Company Types
Not every management company will offer all of these services. Here’s a breakdown of what you can expect from different types of HOA management organizations.
Full-Service HOA Management Companies
Full-service HOA management companies are full-scale, comprehensive operations run by on-site managers. These are closest to traditional property management companies employed by rental property investors.
With a full-service HOA management company, your association won’t need to worry about day-to-day HOA operations. Such companies take care of the vast majority of necessary work, including maintenance requests, financial management, homeowner communications, bill collection, and much more.
Full-service HOA management companies are best for larger communities or associations that have struggling boards or not nearly enough volunteers for all the work that needs to get done. These organizations are also advantageous for HOA boards that want to learn more about how to run their communities efficiently and fairly.
However, full-service HOA management companies usually charge higher fees because they take on a much greater burden of the day-to-day work.
Remote Work HOA Management Companies
Remote work HOA management companies don’t handle most of the day-to-day operations associated with running your community. Instead, picking up trash, handling resident complaints, and other in-person work is left to your HOA board and volunteers.
A remote work HOA management company provides assistance with financial management, accounting, and administrative duties. Furthermore, these companies can provide virtual assistance for a variety of things, such as:
- Tracking and receiving maintenance reports
- Contacting and communicating with vendors
- Planning and helping you maintain reserve accounts
- Getting reviews
For many HOAs, remote work HOA management companies are cost-effective, in-between solutions that give inexperienced boards the support they need without costing too much money. These companies don’t usually charge very high management fees.
HOA Consulting Services
HOA consulting services are ideal for HOA boards that are mostly well-functioning, but which require the assistance of an expert from time to time.
An HOA consulting service sends a consultant for short-term projects or advice, such as managing the association’s budget, helping draft notices to community residents who are in violation of community standards, etc.
With this type of service, you don’t get a lot of extra help from the company, but you also only pay one-time fees for the consultant’s work.
