Got Rent? Going After Delinquent Owners’ Rental Income

Its 2012 and for most associations, their biggest challenge this year, as with past years, will be delinquencies in their community and the all-important “accounts receivable” column on their balance sheet.  For many associations, even more irksome than a unit owner continuing to reside in the community without paying assessments is that same delinquent owner renting out their property and deriving income from it.

Fortunately, the Florida legislature recently acknowledged this circumstance and codified amendments to Florida Statutes 718 and 720 (Condo and HOA, respectively, see “Useful Links” tab above) empowering associations to send demand letters to tenants of delinquent owners, requiring that they immediately begin tendering their monthly rent payments directly to the association instead of the owner of the property.  Of course, a key element to the success of this program has been the threat of eviction.  In addition to providing an association with the right to demand rent payments from tenants of delinquent owners, the applicable statutes (specifically, 718.116 and 720.3085) also allow the association to evict those tenants who refuse to comply.  Since the word “eviction” generally strikes fear in the heart of most tenants, especially those who are able to pay their rent and generally like where they reside, it is this attorney’s experience that tenants who receive a demand letter often contact the association very quickly to arrange for the paying of their rent.

The tenant rent demand letter serves as a low cost way to generate an influx of payments which will reduce an association’s assessment arrearages and  accounts receivable.  Because of the low cost and high success rate, it is this attorney’s recommendation that any Florida condominium or homeowners association ensure that their attorney is using this valuable tool on their behalf.

Daniel Wasserstein

E-mail: danw@wassersteinpa.com

561-288-3999

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