Oregon and Washington state law authorize condominium and homeowners’ associations to impose and collect late fees for late payment of assessments. In some cases, the association’s declaration may state when an assessment is considered delinquent but often the declaration does not provide the amount of the late fee or how frequently it will be imposed. One way an association may establish the amount of the late fee is for the Board to adopt a collections policy. In addition to stating the amount of the late fee, the collections policy can also provide the interest rate that will be assessed, as well as provide clear, concise procedures for handling delinquent accounts.
Adopting a collections policy can help ensure that the association will handle delinquent accounts similarly, which helps protect against owners claiming they are being treated unfairly or differently from other owners. Also, having a collections policy can help encourage timely payment of assessments, because the owners are aware of the steps the association may take if an owner allows their account to become delinquent.
If your association needs assistance drafting or amending a collections policy, please do not hesitate to contact Barker Martin. We would be happy to help your association!