Fees from HOA's (West, Rule, Happy: sale, credit card, lawyer)

[wellguy]

Sometime back, I'm not certain , the Villages of Westcreek HOA started accepting Credit / Debit Cards as a mode of payment for assessments. An email was sent out yesterday informing Homeowner's / Resident's of a new Convenience Charge which becomes effective November 22, 2010. Fee's are as follows:

0 - $150 = $5.00 Convenience Fee
$150.01 to $300.00 = $10.00
$300.01 to $500.00 = $15.00
$500.01 plus =$25.00

Is your HOA in the practice of charging such fee's. Yes times are tough for all but please don't screw the hand that feeds you.

Oh and to make it a "Happy Email" we were reminded that there will be no fee(s) for paying with Cash, Check, or Money Order. My thoughts are that there will be a fee for this soon and they'll call it a Fuel Surcharge to offset the cost of driving to the Bank.

[smitty12]

Originally Posted by wellguy

Sometime back, I'm not certain , the Villages of Westcreek HOA started accepting Credit / Debit Cards as a mode of payment for assessments. An email was sent out yesterday informing Homeowner's / Resident's of a new Convenience Charge which becomes effective November 22, 2010. Fee's are as follows:

0 - $150 = $5.00 Convenience Fee
$150.01 to $300.00 = $10.00
$300.01 to $500.00 = $15.00
$500.01 plus =$25.00

Is your HOA in the practice of charging such fee's. Yes times are tough for all but please don't screw the hand that feeds you.

Oh and to make it a "Happy Email" we were reminded that there will be no fee(s) for paying with Cash, Check, or Money Order. My thoughts are that there will be a fee for this soon and they'll call it a Fuel Surcharge to offset the cost of driving to the Bank.

They are just trying not to lose money by offering the convenience of credit cards. The Bank processing the cards is probably taking 5% or so, plus they now have to worry about charge backs, etc....

The cost of the CC transaction for the association has to come out somewhere, either it will cause a raise in the Homeowners fee, and cost everyone even those who choose not to pay by Credit Card or it has to be paid by the people using cards by convenience fee.

[wellguy]

I do realize that this new fee is for recouping expenses. This would set a lot better with me if when they started accepting them the fee was tacked on at that time.

I would however like to see a copy of the Bank's Credit Card Processing Agreement to see if the HOA agreed not to charge any extra fee's. That I'm certain will be like trying to get milk out of a Boar Hog.

[smitty12]

Originally Posted by wellguy

I do realize that this new fee is for recouping expenses. This would set a lot better with me if when they started accepting them the fee was tacked on at that time.

I would however like to see a copy of the Bank's Credit Card Processing Agreement to see if the HOA agreed not to charge any extra fee's. That I'm certain will be like trying to get milk out of a Boar Hog.

It is probably not that far out of line from my understanding of Merchant cost for taking credit cards. $5 on $150 is 3.3%. But I imagine depending on the bylaws of the HOA you should be able to get a copy of the budget/ledger that shows CC processing costs.

[sapphire]

Ours at the Great Northwest are as follows:

Payment Amount Fee
0 – $150.00 $5.00
150.01 – 300.00 $10.00
300.01 – 500.00 $15.00
Greater than $500.01 $25.00

Identical to the Westcreek ones. They haven't announced whether our assessment is going up for 2011, but I'm already puckering for it.

[scuba steve]

Woods of Deerfield = no fees that I know of. Assessments are probably going down next year too.

[BamaSailor]

But is is legal? Below was posted in the Villages of Westcreek thread. There are some other links in that post (page 370 I believe) that also seem to show this is at least a violation of merchant/credit card company agreements.

Do this apply to the HOA? This is from Texas Code.

§ 339.001. IMPOSITION OF SURCHARGE FOR USE OF CREDIT
CARD. (a) In a sale of goods or services, a seller may not impose a
surcharge on a buyer who uses a credit card for an extension of
credit instead of cash, a check, or a similar means of payment.
(b) This section does not apply to a state agency, county,
local governmental entity, or other governmental entity that
accepts a credit card for the payment of fees, taxes, or other
charges.
(c) The Finance Commission of Texas shall have exclusive
jurisdiction to enforce and adopt rules relating to this section.
Rules adopted pursuant to this section shall be consistent with
federal laws and regulations governing credit card transactions
described by this section. This section does not create a cause of
action against an individual for violation of this section.

Amended by Acts 1999, 76th Leg., ch. 62, § 7.18(a), eff. Sept. 1,
1999; Acts 2005, 79th Leg., ch. 1018, § 2.15, eff. Sept. 1,
2005.

Though there are no Federal laws prohibiting surcharge on credit card use, the following states prohibit merchants from adding surcharges to any credit card transactions.
California Colorado Connecticut Florida Kansas Maine Massachusetts New York Oklahoma Texas
VISA/MC prohibits the practice completely and AMEX does not allow discrimination of their card holders, meaning if a merchant accepts VISA/MC they cannot charge surcharge for using AMEX card.
Exceptions would be government agencies such as Rev and Tax, Motor Vehicles, etc. that are not permitted to pay the bank fees. I guess the question to be asked is...is the HOA considered a merchant...do they provide a service...it would take a lawyer to straighten this out but almost all CC companies prohibit this practice its considered a penalty use provision..check your credit card contract...maybe its time to start a branch of "the Assessments too Damn High Party" around here.

[wellguy]

I have always thought that an HOA was a Non Profit (Although they will make a Buck any way they can) Yes they provide a Service but they would not be a merchant. Therefore from what I read they would be prohibitted from charging this Fee.

Again my ***** is that sometime back they ALLOWED Folks to pay this way. Right, Wrong, or Indifferent and no one is to judge, there are Folks that have to sometimes charge. This damned surchage will hurt those that have to go this route. In a time when we have struggling neighbor's the HOA needs to have a little heart and forget about this surcharge. One of the biggest problems I have had for years is that the HOA and BOD change their minds mid-stroke.

We have always paid by check and will continue to do so although as I have said I was considering using the SSFCU Debit Card (as a Credit Card).

I do not F...... mind helping those out that are in a bind. The STBTC just gave me three $25.00 HEB Gift Cards and they left my hands pretty darn quick. The HOA is making money off of us anyway and again this is by choice since we do not use the SportsPark, we don't attend the Picnic's etc..

[sapphire]

They'll just raise the assessment next year and justify it by showing proof of the added expense of processing credit card payments. Or, just quit taking them at all. That may hurt the guy that doesn't have the cash.

[wellguy]

Originally Posted by sapphire

Ours at the Great Northwest are as follows:

Payment Amount Fee
0 – $150.00 $5.00
150.01 – 300.00 $10.00
300.01 – 500.00 $15.00
Greater than $500.01 $25.00

Identical to the Westcreek ones. They haven't announced whether our assessment is going up for 2011, but I'm already puckering for it.

Hmmm.... I wonder if both HOA's use the Same High Priced Attorney.

The GNW must be doing something right in order to provide you all with what they do. Knowing that they dropped your annual assessments in 2008 is pretty darn impressive.