Jeff Ostrowski
Alexandra Clough
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Financing firm offers option for struggling homeowners associations
Homeowners associations plagued with deadbeat owners face little choice but to cut services or raise fees to cover people who aren’t paying.
An upstart firm based in Hallandale Beach offers associations a new option. The company, Association Financial Services, writes a check to the association for the amount of its quarterly dues, then takes over collections.
Stan Schultz, developer of the Equus development west of Boynton Beach and head of the Equus homeowners association, leaped at Association Financial Services’ offer.
At Equus, about a quarter of homeowners are behind on their dues — meaning the association gets less than $100,000 from the $130,000 it’s owed each quarter.
“We struggle, because the association has to take care of the common areas, the security at the gatehouse, the clubhouse,” Schultz says. “If the homeowners aren’t paying in where is the money coming in?”
Schultz says the upfront check relieved the financial pressure at Equus.
“They’re really filling a void, big-time,” Schultz says. “It gives the association a hell of a lot of breathing room.”
Kenneth Arnold runs Association Financial Services, and he started the company two years ago, before associations were struggling with deadbeat owners. Arnold’s company makes its money by collecting late fees and interest from borrowers who are behind.
Equus is one of 30 communities that have signed up with Association Financial Services, Arnold says.
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Comments
By Get in the Game
July 11, 2008 1:15 PM | Link to this
Three “i’s” to every cycle.
Innovation Imitators Idiots
Reads as a viable solution to HOAs that were charging ridiculous fees anyway.
Gives them a breather to retrench and further cut costs.
While AFS fills the void as a debt collector.
By SAY WHAT?
July 11, 2008 3:12 PM | Link to this
How can this happen in gated community!?