CMCA - Certified Manager of Community Associations Assessments and Collections Questions and Answers Flashcards

A homeowner disputes a late fee and sends a check marked 'paid in full' for less than the balance owed. What should the manager generally do first?

Answer: Consult the association's collection policy and legal counsel before depositing

Depositing a 'paid in full' check may create an accord and satisfaction in some states, so policy and counsel should guide the decision.

Which report is most useful for identifying which owners are 30, 60, and 90+ days behind on assessments?

Answer: Accounts receivable aging report

The aging report groups delinquent balances by how long they have been outstanding.

An association uses a third-party collection agency to collect delinquent assessments. Which federal law most likely governs the agency's conduct?

Answer: Fair Debt Collection Practices Act

Courts have generally treated HOA assessments as consumer debts, so third-party collectors must follow the FDCPA.

In associations where assessments are allocated by percentage interest, what usually determines each unit's share?

Answer: The allocation formula stated in the governing documents

Assessment allocation is set by the declaration, often based on unit size, value at creation, or equal shares.

What is the main purpose of a written, board-adopted collection policy?

Answer: To ensure delinquent accounts are handled consistently and in a timely way

A uniform policy treats all owners equally and reduces claims of selective enforcement.

An owner files for Chapter 7 bankruptcy while owing past-due assessments. What must the association do right away?

Answer: Stop collection activity on the pre-petition debt because of the automatic stay

The automatic stay bars collection of pre-petition debts unless the court grants relief from the stay.

Which method of receiving payments reduces handling risk by sending owner payments directly to the bank for processing and deposit?

Answer: Lockbox service

A lockbox lets the bank receive, process, and deposit payments, which strengthens internal controls.