Keep An Eye Out For The Small Print in HOA Contracts
Every association requires contracts, meaning every board must determine if the contract is good or bad.
Always Read Beyond Page One
Board members usually need to gain business experience. They may determine that the rice is excellent and sign the contract. Often, they may only read one page of the proposed contract. Many of these contracts only tell you the real story of the agreement on page 5 or 6 (just an example) when a list of extra charges is in small print. Especially community association management contracts are dangerous if you only check page one.
It’s often less expensive for the community if page one lists an all-inclusive price, even if it is much higher than the offer on other bids. Low-ball offers on page one often turn into high-cost offers on later pages in the small print when you add all the extra charges for many things that will happen daily. Watch out for charges on these contracts to supervise construction contracts. Your CAM is not an engineer and has most like as much knowledge about construction work as you do. But you want to pay him to “supervise” the licensed contractor?
Other Language in Contracts
And then there is the actual language of the contracts. Most of them are written by attorneys in legalese, often using words not in our daily vocabulary. Beware of these contracts! Always have these contracts checked by your association attorney, who is familiar with legalese and knows the tricks of the trade.
And then there are the construction contracts. They are often lengthy and tricky because they deal with issues people on the board might need to learn about. Watch the small print on the final pages and compare the bids you receive. Ensure all the contractors you want to hire are experienced in doing such work for many years, the necessary licenses, and insurance policies (check dates).
Bulk Cable Contracts - Beware!
And then there are the bulk cable contracts. Today’s world of technology is fast advancing. What’s in today may be outdated tomorrow. Don’t burden your association members with long cable contracts. Many people nowadays don’t use cable TV or landline telephones anymore. All they need is high-speed WiFi. Why should they pay for cable TV? In our day and age, it may be a much better idea to have each owner make his/her own decision about how they want to connect their TV, Internet, and Telephone.
No matter what kind of contract you are contemplating signing, look at all the “small” print and have some expert – like an attorney – check for all the little traps contained n many contracts. Remember the adage: BUYER BEWARE! Contact us today if you have questions.