HOA vs. HOA Management Company: What Are Their Responsibilities?

Community management is not an easy task. It needs the cooperation of the HOA board, house owners, HOA management companies, and vendors. 

Every entity has a specific role to play. So, it’s essential to understand the various parts of homeowners associations. For instance, what’s the difference between the HOA board and the HOA management company? 

HOA Vs. HOA Management Companies

Both the HOA board and the HOA management company have similar goals. They work to enhance the community’s success and ensure that homeowners follow the community’s rules and regulations. 

These roles sometimes overlap, but there are also some differences in their functions.

HOA Board of Directors

The HOA board consists of volunteers elected by homeowners. These directors ensure the smooth running and general welfare of the community by overseeing things like community improvement, management of common areas, and homeowners dues. 

They also have the power to impose fines or restrictions on members who violate the HOA rules and covenants.

In small communities, the HOA board can easily manage the community’s affairs. But in larger communities, it becomes difficult since the directors also have their careers and other interests. And that’s where a community association manager comes in handy.

HOA Management Company

An HOA management company is sometimes called the property owners association (POA). 

That said, an HOA manager is usually hired to offer management solutions in areas like contract management, law, and accounting. 

As mentioned, the HOA board may lack the skills or time to ensure proper community management. The directors are also community members, making collecting dues and fines difficult. But, community association managers are not HOA members. Therefore they can work without bias. They further relieve the board from confronting their neighbors on issues involving finance, bills, fines, and social violations.

What Is the Role of an HOA Manager

Enforcing Rules and Regulations

A community association manager usually helps to draft the HOA’S covenant and rules. These regulations are there to make sure the community operates smoothly. That way, the HOA can maintain the community’s appeal and social standards in common areas.

Rules and regulations may cover gun ownership, parking, political signs, landscaping, and more.

Maintenance of Common Areas

Every homeowner wants the community to maintain its attractive aura. So, the manager does this on behalf of the HOA board of directors. Their duties include working with vendors and contractors to ensure common areas are protected, safe, and adequately insured.

Financial Management

HOA management companies also take part in the planning and implementation of budgets. Typically, the HOA board has to have an annual budget. Most managers work to understand the community’s financial position. And they also help the board forecast the expenses for the upcoming budget.

The manager can also help collect bills and fines due to constant inflation. The HOA depends on homeowners’ dues, and an aggressive collection policy is essential to ensure the community meets its needs.

Dispute Resolution

The HOA manager can also handle disputes between homeowners. Most states have laws that require arbitration and mediation before any legal actions. So, the HOA manager can help settle disputes among neighbors or against the board.

Disputes such as excessive noise or painting violations may fall under the manager’s purview. 

Risk Mitigation

The manager should try to limit risks down the road. They assess possible liabilities and ensure the community’s insurance coverage is up to date. 

Remember, the manager cannot procure insurance or loans without the board’s approval. However, the manager can help seek viable bids, competitive loans, and more.

Internal Communication

The board and HOA management company must always keep an open line of communication. The manager can help the board to coordinate their meetings, create reports, and give notices, among other tasks. 

Hiring an HOA Manager

Your community association manager wears several hats in community management. HOA management companies serve several functions, from financial administration to site management. So, when hiring a manager, ensure they are good at problem-solving, communication, organization, time management, and leadership.