Managing arrear levy debt for a stress-free December
Arrear levies are an inevitable issue faced by community schemes in South Africa. From late payments to non-payments, unit owners oftentimes struggle to comply with levy requirements – despite these being governed by national laws. Further to this, there have been historic external factors that have impacted levy payments in community schemes around the country. The most recent being the COVID19 pandemic, which saw hundreds of people unemployed and unable to honour their financial duties. This combined with an increase in the prime interest rate, a struggling economy and low purchasing power has meant that many cannot afford to pay their levies.
Oftentimes, unit owners also assume that levies are not “important” compared with say a bond repayment since the latter is linked to a formal financial institution. These unit owners fail to recognise all the essential costs that levies cover – from gardening services to security maintenance and control, levies are crucial for the effective management of an entire sectional title scheme.
This inability of unit owners to pay paired with sectional title ignorance can take a serious toll on a community scheme, as it could mean not being able to maintain the estate and pay staff salaries. In the worst of cases, non-payment means the scheme is unable to function normally and eventually loses all investment appeal and value.
So, what are your options when a unit owner decides not to pay their levies? The first step is to be well-versed in the law and what rights the body corporate has in terms of debt collection. Several legal professionals at STS can for example, offer expert advice and opinion on all matters relating to levy debt collection and community scheme issues in general.
The second step is to communicate with the non-paying owner as soon as possible. The sooner the matter is addressed, the sooner it can be resolved, and any unintentional consequences averted. This could also mean that payment plans can be created and agreed upon between the unit owner and the scheme. Thirdly, it is wise to make sure your paper trail is in order. In other words, you need evidence that you have sent unit owners their statements so that they have no reason to avoid paying.
Lastly, any community scheme with arrear levy debt can reach out to a professional and accredited funding service provider who can not only guide them on any legal process but provide a solution to ensure that they can operate effectively on a fully-funded basis as if all owners were paying their levies.
At STS, we pride ourselves on being experts in community scheme funding and specifically arrear levy solutions. We see levies as the lifeline of the community scheme and realise their place and importance in running a successful living environment. Therefore, we have come up with several solutions to make the levy debt collection process a smooth and effective one. We offer bespoke funding facilities with no sign-up or initiation fees, and we fund 100% of arrear levies with no discounting.
So, for a fast and simple levy debt collection process, contact us today and let us keep your community scheme afloat.