Avi Tryson.Coral Gables Managing Partner.Goede, Adamczyk, DeBoest & Cross.Coral Gables

The pandemic has forced many associations to operate outside of their normal procedures. Travel restrictions, self-imposed and governmental required isolations, and potential closures of offices and banks are forcing associations to find creative solutions to unique problems.

Associations will be financially impacted by the pandemic With many businesses operating with reduced hours or indefinitely shut down, a great number of people are already feeling financial strain. This may result in many owners not timely paying their assessments. At the same time, however, associations must navigate collection and foreclosure restrictions by local, state, and federal governments.

At the time of this writing, there is no federal restriction on the collection of consumer debt, but Florida's governor has ordered suspension of all "mortgage" foreclosures. Conservatively, the order applies to association lien foreclosures, but some Florida counties are allowing lien foreclosures to proceed while others are suspending all activity in lien foreclosure cases. This is a fluid situation which will require associations to keep an eye on temporary changes in policies enacted at all levels of government.

Note that the foregoing restrictions do not prevent associations from proceeding with sending owners pre-lawsuit demand letters or otherwise making attempts to collect assessments from delinquent owners. As long as county recording offices are still operating, associations can record a claim of lien against the property as they would under normal circumstances.

Some associations also want to implement forbearance procedures, waive interest and late fees, or allow payment plans. However, associations should avoid making blanket statements that they are offering such accommodations, as such a statement will likely incentivize owners not to pay their assessments even if they have the ability to do so. This policy also compromises existing and future collection accounts that have no relationship to the pandemic. Instead, it is recommended that associations work with delinquent owners on an individual case-by-case basis after the assessment is due and late, as the goal is to continue to collect as much assessments as possible so that the associations may continue to operate.

Avi S. Tryson is the Coral Gables managing partner of Goede, Adamczyk, DeBoest & Cross. He focuses his practice on community association and real estate law.