Is Your Homeowners Association in a Position to Borrow Needed Funds?

It is commonplace for homeowners associations to find themselves in a position of needing to raise money for various reasons such as making costly unanticipated repairs or for making desired capital improvements. This need can result from unexpected occurrences such as a casualty loss, or in many instances, from the association’s failure to properly budget and build up reserves over an extended period of time. As buildings age, the need for repairs and replacements becomes a reality and, when the funds are not held in reserve accounts, the association finds itself in a position of needing to raise the funds through special assessments or loans, and due to all these factors, can your HOA borrow money when it is absolutely necessary?