Many Associations confront themselves with the difficult choice of not having enough financial resources to move forward with paving, roofing, painting or repairs. End result: everything seems to be in chaos; and no hope.

In fact, some communities have problems getting vendors or workers. These communities do not pay as agree, no because they do not want to; rather they do not have the funds available.  

The reason for this is usually a cash flow  issue. Simply, the Association may not have the financial resources to fund the jobs needed to fix the problems, or the reserves are under funded.

In these situations the Association would have to raise the monthly fee, impose a special assessment, or a combination of both, or look forward to external financing.

The choices are very difficult and maybe impossible, either because the financial possibilities of the owners may not permit an increase in the maintenance fee, or that the special assessment would be so onerous that it may not be feasible to implement it. Florida’s communities historiography is plenty of cases.

However, once it has been determined that external financing is necessary, the proceeds from the loan must be kept separate from the operating account, since commingling the funds would be very confusing and diluting the efforts by the Board to identify the restored assets and other expenditures not contemplated in the operating budget.

This is the reason why our Accounting Manager,  keeps separate schedules and prepare special reports, with emphasis in showing, at any moment in time, the composition of the ending balances and the line items where the expenditures have been made.

Our Accounting Manager, a professional with long experience working at listed public companies in Wall Street.

Gold Property Management and Associates, Inc, have been approached by a few banking institutions that would lend money to community Associations on a medium term basis that either would make the increase fee or the special assessment unnecessary, or affordable.

These are soft loans at low commercial interest rates. The presentation to the bank of the projected cash flow and debt servicing capacity of the Association  is fundamental, and requires clear expenditures projections and cash inflows, and very important, a deeply committed Board of Directors, since financial discipline is essential.

The results are in most cases very impressive. The financial rescue of the Association's financial affairs shows up in the recovery of property value and the pride of residents, who are more proactive, cooperative and interested in the community affairs.

Regarding the banks, no predatory lender is amongst them. These are bankers that live in communities like ours. They know and care. They understand.

Again, a committed Board profile is a must. The rest is to work on the financial cash flow and debt servicing capacity of the Association.

For that part…We know how.