Collecting dues is often the first job a new treasurer worries about. Taking payments online makes it easier for owners to pay on time and gives the board a clearer record. Adding a payment button is usually the easy part. Problems tend to come from a rate nobody can show was approved, payments recorded in two places or late fees the documents never allowed. This guide covers each step in order.
1. Start with a rate the association approved
Every dues charge should trace back to a decision. Depending on your governing documents, the board may adopt the budget and set dues, or the members may have to approve it, and some documents or states limit how much dues can rise in a year without a member vote.
- Record the date and the vote that approved the budget and the dues amount, in the minutes.
- Note how dues are divided among homes. Some associations charge every home the same amount. Others, often condos, divide the budget by each unit's percentage interest or by home type.
- Decide how often you bill (monthly, quarterly, twice a year or once a year) and the due date.
- When the rate changes, keep the old rate on file with the dates it applied. Last year's charges should still point to last year's decision.
2. Bill every home the same way
Each home should have its own account showing every charge, its due date and what has been paid against it. When a billing period starts, post the charge to every home at once and tell owners it is due. Before you bill, check that the list of homes is current, that new owners are on file after a sale and that no home is being billed twice.
Keep special assessments separate from regular dues. A special assessment is a one-time charge for a particular project, such as a roof, and it usually needs its own approval under your documents. Label it clearly so owners and the treasurer can tell the two apart.
3. Offer card and bank transfer, and decide who pays the fees
Most online dues payments go through a payment processor, which handles the card or bank details so the association never stores them. Owners usually have two choices.
- Card. Owners know how to use it, and the payment is confirmed right away. Card fees are the higher of the two.
- Bank transfer (ACH). Much cheaper for the association, which matters on large dues payments. It takes a few business days to clear, and a payment can be returned if the owner's account is short, so don't mark it paid until the money arrives.
The processor normally deducts its fee from each payment before the money reaches your bank, so the association pays it. Some boards would rather owners cover card fees. Before you add a surcharge or convenience fee, check your governing documents, the card networks' rules and your state's law, which may restrict it. Encouraging bank transfer for large payments is often the simpler way to keep fees down. Check the processor's current pricing for the actual rates.
Keep accepting checks. Some owners will always prefer them. Record each one against the home's account the day it arrives, so the owner's online balance stays correct.
4. Partial payments and payment plans
When an owner pays part of what they owe, record it and leave the rest open. A common approach is to apply a payment to the oldest open charge first. Some states and governing documents say how payments must be applied, for example to dues before fees, so confirm your order with your attorney.
A payment plan turns a large balance into installments an owner can manage, and it keeps the account moving toward zero. Write a payment plan policy before you need one, covering who may approve a plan, the most installments you allow and whether late fees stop while the plan is current. Then offer the same terms to everyone in the same situation. Some states require associations to offer a plan before certain collection steps, so check yours.
5. Late fees, only if your documents allow them
A late fee needs authority. Check that your declaration or bylaws allow late fees, whether they set the amount and whether your state caps it. Then adopt a written policy that states:
- the grace period after the due date,
- the amount, and whether it is charged once per overdue charge or monthly,
- whether late fees stop while an owner is on an approved payment plan.
Apply it the same way to every home, including board members. Waiving a fee for one owner and not another is the kind of inconsistency that comes up later in a dispute. If an account stays unpaid, the steps after late fees, such as a formal demand, suspended privileges or a lien, are governed by your documents and state law. Our page on collections and lien readiness explains which records those steps depend on.
6. Reminders and receipts
Many late payments are simply forgotten. Tell owners when a charge is posted, remind them before the due date if you can, and send a polite past-due letter soon after the grace period ends. Use the same schedule for everyone.
Give a receipt for every payment, including checks and cash. A good receipt shows the date, the amount, the method and which charges it paid. When an owner disputes a balance, a receipt that lists the charges it covered usually settles the question.
7. Reconcile with the bank every month
Your records say what owners paid. The bank statement says what actually arrived. Reconciling means matching the two, line by line, each month.
- Match each deposit to the payments it contains. A processor often deposits several card payments in one amount.
- Record processor fees and bank fees as expenses, and record interest as income.
- Investigate any deposit you can't match, and any payment you recorded that never reached the bank.
- Follow up on returned bank transfers and bounced checks. The owner still owes the money.
- Sign off the month only when your records and the statement agree.
Clean monthly reconciliations make the year-end much easier. Our Form 1120-H year-end checklist picks up from here.
How HOA in a Box collects dues
HOA in a Box keeps dues, payments, plans and the bank reconciliation in one set of records that the board and each owner can see. Here is how it handles each step above.
- The rate and its approval. On the Dues tab, the treasurer sets dues as a flat amount, by percentage interest or by home type, chooses how often they are billed, and records the date the board approved them. Changing the dues closes the old rate and starts a new one, so earlier charges still point to the rate that applied.
- Preview, then bill. The board sees what a billing period will raise, home by home, before billing it. Each household is notified, and no home is billed twice for the same period.
- Card or bank transfer. Owners pay from the resident portal through Stripe Checkout, so card details never reach us. Bank transfer is available when the board switches it on. Anyone can also pay toward a home from the public pay page without an account. Stripe deducts its standard fee from each payment, and we add nothing on top.
- Checks, cash and partial payments. The treasurer records checks and cash, which are applied to the oldest open charge first. A partial payment reduces the charge and leaves the rest open.
- Payment plans. Owners can ask for 2 to 12 installments from the portal. The board approves or declines each request with a note the owner sees.
- Late fees, off until you switch them on. When the board turns them on and sets an amount, a late fee is added once per overdue charge after the grace period, and never while a payment plan is active.
- Receipts. Each payment appears in the owner's history with a line for every charge it covered, and owners can choose to be notified by email or push notification.
- Bank reconciliation. When the board switches it on, the treasurer imports the bank statement, matches or explains every line and signs off the month. The month won't close until the numbers agree.
HOA in a Box doesn't send automatic past-due reminders. The board sends a past-due letter from a dues template as an official notice, which is numbered and saved with the owner's account. See the full list of money features on the features page, and every plan's price on the pricing page.