Borrowing Money to Make Repairs and Improvements
As the association industry matures, more and more communities are faced with the responsibility and need to perform major repairs of common facilities. Often, because of poor planning, inflation or unanticipated problems, associations have not accumulated sufficient reserves to finance the needed repairs.
Typically, in the past, when faced with a situation where major repairs were required and funds were not available, associations had no alternative but to pass a special assessment to raise needed cash, defer repairs or complete the work piecemeal over time. Each of these solutions has its own shortcomings and can create new problems for the board and the association members.
Fortunately, banks are becoming increasingly aware of associations' need for loans. Some financial institutions have even established specialized divisions to handle association needs. Loans can be a practical alternative to the choices listed above.
