Collections and Cash-Flow Can Be Some of the Trickiest Job Functions for Property Managers
Collecting assessments that are due to your HOA is crucial for your association’s finances and cash-flow.
However, they can also lead to unnecessary conflict if not handled properly.
It is the fiduciary duty of the board members to collect dues and assessments to maintain the community’s vested interests. Keeping collections consistent helps increase your properties cash-flow and revenue. Outstanding balances and owed payments prevent your business from growing and can keep your community from improving. Fortunately, there are many steps property managers can implement to help smooth out the collections process and keep their community’s cash-flow running strong.
Tips for Improving the Collections Process and Cash-Flow
1. Implement automated collections. This is the quickest and simplest way to ensure collections are completed in a timely fashion. With an automated cloud-based system, like Enumerate Central residents can automate recurring payments for the convenience. This reduces late payment or incorrect payment amounts, and distributes an even monthly cash-flow. Automating collections can also help HOAs keep accurate bookkeeping. With more payments being made on-time, your system has the most up to date cash-flow and keeps your accounting accurate. You can also encourage early payments that improves your cash flow sooner.
2. Assign a collections owner. Sometimes having multiple people handling one task can lead to a breakdown in communication and disorganization. Assigning collections to one person can help prevent these issues. When it is one employee’s main responsibility to handle collections, they can get the work done quicker, easier, and with less stress. This person should be a mid-level employee, and this should be their main job assignment. While it may seem to make sense to assign it to a manager or someone with more authority, that individual usually has other important tasks and collections could end up taking longer to complete. Hiring one person to handle this task can help keep collection completion on schedule and keep cash flow consistent. It can also help build a better relationship between HOAs and residents having one person be the face between homeowners and your board.
3. Keep open communication and have an escalation process. Sometimes when dealing with collections from residents there may unforeseen issues that lead to missed payments. Many times, it may not be the fault of the homeowner. There can be a system issue that leads to a discrepancy in pay. Maybe the payment amount was entered incorrectly, or the system didn’t properly calculate the amount due. There could also be other system issues that prevent owners from accessing their payment portal. In any event, it is imperative for the HOA and the collections owner to have an escalation process in place so that payment is still made on time and there isn’t a rift between the homeowner and property manager. Keep open communication with the resident and work together to solve the problem in a timely fashion.
Nobody Wants to Be the Bad Guy When It Comes to Enforcing the Y-Laws as It Relates to Late or Unpaid Payments
They can often cause conflict with residents and if left undone can affect revenue and cash-flow.
Using the steps above you can reduce the amount of time needed for collections and keep a good relationship with your residents. HOA software, like Enumerate Central can make your collections process easier, more organized, and less of a hassle. Improve your collections process now and see your cash flow increase.
