Who Doesn’t Have Grief With Their HOA?

Those who hire professionals to run it, that’s who
BY: OPHILIA PAYNE

Managing Home Owners Associations is dicey in the best of circumstances. For foreigners in Mexico, it’s beyond tough, it’s fraught with grief.

First of all, enforcement of the rules should not be the job of the homeowners. Who wants their neighbor to tell them they can’t use the pool? And do you want your neighbor to tell you you can’t use the pool just because you’re behind in your HOA fees? No, you will weenie out for sure. Or you will work up such a head of steam you will piss off your neighbor and still not get the money. You need to third party those HOA rules out, and if you’re smart about it, you save money and headaches doing it.

We talked Jorge Macias and Suail Iñiguez who work for Associa, an international company out of Texas that has more than 4 million homeowners under management. Their local office is in San Jose where they observe best practices learned over the years in the United States.

Associa has a variety of services packaged to fit individual HOA needs.

“Without an income stream your association cannot function,” says Macias, right out of the gate.

“Finances should be your top priority. An association’s financial house can fall into disarray for a variety of reasons. Which might include an apathetic board, a clueless board, or simply a new association that doesn’t know what to do.”

So the first order of business Associa looks at is getting the finances in order. They swing into debt recovery mode almost immediately, and they have the legal tools to get that money. And, before we can even ask, he assures us HOA scofflaws can be denied access to certain parts of the property. Not their home, but they may be required to walk to it since they can be denied access by their car. A favorite first tactic in debt collection is to deactivate the gate card.

Next, or rather at the same time, all the vendor contracts are reviewed by Associa. Do you even know what a gardener or pool guy should be paid? Asks Iñiguez. And do you know what payroll taxes are due on his behalf and when? No, you do not.

Associa analyzes and rebids all the major contracts you’re in. Are you getting the best deal for your trash removal, housekeeping, or maintenance? Tells us a ship shape HOA should be rebidding their contracts every three years or so, even if you’re getting great service.

Reserve studies are a foundational document that helps you budget in your community and keep special assessments under control, Make sure your community has one, and that it’s been updated within the last five years. In the event it has not been updated or doesn’t exist, you need to carry out a reserve study as soon as possible. If you do have a recent study, make sure you’re actually following the budgeting recommendations it provides. If not, the dreaded special assessment might be looming in your future.

Many Associations must be audited for tax purposes. If you’re looking to do a deeper dive, you can carry out an out-of-cycle audit to make sure everything is clean. This is particularly important if you’re changing management companies or suspect hanky panky. There are plenty of horror stories of communities that have faced embezzlement.

These actions will help right the ship, but without careful maintenance and diligence, you may end up back where you started. Sure your board is taking your Condo Association finances seriously, but how many of them speak Spanish and are up on paying taxes and employment law in Mexico? Asking them to run a business in a foreign country is a big ask.

Associa customizes its approach to new clients, but they do have two main bundles of services. The first one we’ll explain is financial only. This service includes billing and collections, handling the Mexican accounting that’s required by law, paying your taxes, and keeping you legal with employees, who have an amazing assortment of rights. Violate those rights and you will surely be defending yourself in labor court.

The second area Associa rides in to rescue is their full service. They will send a manager on site two or three times a week. He/she will be checking for such things as the job the maintenance people are doing, and they will actually supervise those people. They will find and interview new hires for you and will enforce the rules and regulations. They arrange conference calls with the board they work for, often by group conference call using equipment in their conference room. This is important down here because it’s rare that everyone on the board is in the country at the same time.

They also will run the annual assembly, which is a legal requirement of your HOA. They will collect proxies, take the mandatory minutes and get them certified and filed, draw up a suggested agenda, and generally keep the association within the legal requirements of this general assembly.

Another nice feature Associa has is their up to the minute technology. They will run a website that keeps everyone informed of what’s going on, with different layers of accessibility, from vendors to board members, to homeowners. That’s called Town Square, and with this software, everyone knows what’s going on with their investment, even if they seldom come to Mexico. The proprietary management software also tracks the full spectrum of key community operations.

The first step is a phone call or email to their local office here in San Jose. After an assessment they make a proposal for your board to vote on, straight up or down, (yes or no), or your board can vote on what they would like in Associa’s smorgasbord of services.

Call Associa at (624) 172-6593. They’re at km. 28.5 on the four-lane, just south of San Jose.