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Capital Planning with Confidence

Capital Planning with Confidence

Funding Your Community

The majority of community associations in the United States are underfunded. Managing a condo or homeowners association is like operating a small municipality: your communal operating costs should be supported by resident payments, and those payment costs should increase annually just like municipality taxes.

But that’s easier said than done in a residential community. Now, more than ever. Finances are tight for everyone, and budgeting scrutiny is on everyone’s minds. Your boards aren’t the only ones trying to beef up their rainy day funds, residents are just as cost-conscious these days.

Managing the delicate balance between short-term goals and long-term gain is tricky, so it’s important to find the right resources, like a comprehensive reserve study and a community association banking partner.

The Planning Phase

You know that determining your community’s budget and replacement reserve schedule is more than just assessment increases and immediate needs. It’s long hours of determining the right areas to maintain and improve your community without overburdening your residents.

So what happens when a reasonable assessment increase or your replacement reserve fund just won’t cut it? Sure, you could issue a special assessment, but you risk your residents falling behind on payments and a higher rate of delinquency in your community. A community association loan from NCB is a practical, resourceful approach to costly projects your community needs to maintain or increase value. Borrowing can provide an opportunity for boards to actively manage long-term capital allocation and avoid short-term funding deficit situations. Click here to learn more about the solutions NCB has to offer your community.

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