Every condo association and HOA is required by law to have a board composed of unit owners. These individuals provide for the management and maintenance of the property. Associations face a critical issue when no one is willing to serve on the board. In small associations, this is a common problem. 

A functioning board is vital for governance, maintenance, and compliance. Without one, property values and infrastructure could decline, leading to unpaid bills, abandoned contracts, and jeopardized insurance.

If no volunteers come forward, the county or state might require hiring outside management, a costly and undesirable solution. The message is clear: maintaining a proactive and involved board is essential for the stability and well-being of any community association.

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Condominium and common interest community associations operate under a board of directors typically comprised of three to seven owners, who then elect officers like president, treasurer, and secretary. The role of president is crucial, serving as the primary liaison between the board and professionals, setting meeting agendas, and leading discussions. However, the president's authority is not absolute; decisions are made by majority vote. Failure to recognize this collective responsibility can lead to issues such as personal attacks on officers, erroneous beliefs about individual liability, and difficulty in fostering a team environment.

To address these challenges, officers and board members must acknowledge their role within a team, collaborate on goals, lead by example, and emphasize collective achievements over individual contributions. Ultimately, successful governance relies on the unity and cooperation of the entire board, rather than any single member.

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Congress has adopted The Corporate Transparency Act (CTA), requiring domestic reporting companies, including condominium and community associations, to submit information to the federal government regarding the beneficial owner of the corporate entity (i.e., the person who has substantial control or at least 25% ownership interest in the corporate entity) by January 1, 2025. The definition of "beneficial owners" has been extended to include board members of condominium associations.

Associations will need to take action to file necessary reports disclosing beneficial ownership information by the end of 2024. There are significant fines that may be levied for failure to complete this reporting.

The US Department of the Treasury's Financial Crimes Enforcement Network website can be accessed here: https://www.fincen.gov/ The required report can be submitted online.

Learn more here. 

Maybe you've heard the term "Reserve Study" and don't know what it is. Maybe you've never heard of a Reserve Study at all! If you live in a condominium building, however, this is a term you should know.

Reserve studies combine an inspection and funding plan that addresses all of the repair and replacement of your building's components over time. Many states are beginning to require Reserve Studies, and while Illinois is not currently one, that could change in the future. 

Join Condoly and their vendor partner on Thursday, May 30th at 6:30 pm to learn the basics of Reserves Studies.

Register your FREE Condoly account or Sign in to your existing Condoly account to register.

Freddie Mac has made its list of condominium and housing projects categorized as "not eligible status" accessible to authorized representatives of condominium associations or housing cooperatives, indicating potential noncompliance with lending guidelines. This could lead to problems for owners wanting to sell.

Condominium project eligibility is crucial as Fannie Mae and Freddie Mac support around 70% of the mortgage market. Freddie Mac utilizes green and yellow statuses for condominium projects, with green indicating compliance and yellow suggesting caution due to non-compliance with requirements. To determine eligibility status, authorized representatives must complete a form on Freddie Mac's website, including project details and, if appealing a "not eligible" status, supporting documentation. 

Learn more here.