February 7, 2023

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Are You Terminating The Contract With your HOA Management Company?

Why Is A HOA Management Contract So Important? | HOAM

If you are a board member of your homeowner association and hired a company to handle various tasks, the contract may come to you for renewal. The contract from the company has several key areas mentioned including the tasks, rules, violations, fines, penalties, payments and termination clauses. In case, you want to switch to one of the flagstaff hoa management companies, you might consider terminating the contract. A number of reasons can be accountable for terminating the contract with the existing HOA Company. Some of them may include poor performance, violations and others. 

Review the contract properly

If you want to avoid the penalties due to terminating the contract, you should review the contract properly. Termination terms and conditions may be elaborated on in the contract including the notice period, payment structure, any advance payment or penalties if the contract gets terminated before the specified time period. Doing so will prevent you from paying penalties and fines.

Length of the contract 

Most contracts last for one year, two years or even three years. Sometimes, they get renewed on their own because of the agreed-upon terms. However, it is important to look into the contract before the end date approaches. In many cases, board members may decide to amend the terms and conditions of the contract and it is the right time to do so. Moreover, you should tell them well in advance about any amendment so that they can also decide accordingly. Many a time, the company may not agree with the new policies and rules. It may ask you to end the contract altogether.

Payments and fees 

It is suggested to discuss with your HOA Company about payments and fees that you will have to pay if you don’t wish to continue with it. Prior notice is important in most cases and if you fail to do so, you might have to pay them some amount as compensation. However, it is a good idea to have an attorney on your side when reviewing the contract so that you can understand the language in a better manner.

Performance of the HOA Company

The homeowner association may take the decision to terminate the contract with the existing company because of its poor performance. It is a major decision and needs to be considered on various factors. 

It is a good idea to discuss with other board members before ending the contract with your existing HOA Company.