Your community can stay afloat during tough times through our arrear levy lifeline

Across South Africa, community schemes are feeling the financial squeeze. Rising living costs, higher interest rates, and inflation are making it harder for homeowners within complexes, estates and flats to keep up with levy payments. For many sectional title schemes, this means cash flow is tight, projects are on hold, and trustees are left juggling impossible financial decisions.

Managing a body corporate has also never been more challenging. The fiduciary responsibilities of trustees require them to maintain the financial health of their scheme, yet many are finding themselves forced to defer essential maintenance, energy efficiency upgrades, and much-needed building improvements, which results in a gradual decline in property value that affects every owner. At the same time, trustees often face personal risks in their roles, including potential legal action from unhappy owners or residents. It’s a heavy burden to carry, especially when the resources to manage these pressures seem out of reach.

That’s why STS is committed to empowering communities and supporting trustees through these difficult times. Our goal is to provide accurate information and practical solutions that help communities regain financial stability and protect their most valuable asset: their homes.

The non-payment of levies can quickly destabilise a community scheme. Without steady income, body corporates struggle to cover daily operational costs and essential maintenance projects. Soon, paying unit owners are left to carry the financial load either through special levies or by tolerating delayed repairs and building decay.

In some cases, the impact is even more severe. Last year alone, several municipalities disconnected services to properties, including community schemes, due to unpaid accounts.

To prevent these situations and ensure complexes, estates and blocks of flats can operate efficiently, STS, in partnership with BC Funding Solutions, offers a tailored arrear levy funding solution. This allows a scheme to function as if all owners are paying their levies, providing immediate financial relief for every individual while maintaining operational stability.

We’re often asked whether STS purchases arrear levies from community schemes. The answer, as explained by Schalk Liebenberg, our Regional Sales Manager for Pretoria, is no: “The arrear levy funding offered by Sectional Title Solutions is a loan advanced to the community scheme. It’s not the purchase, factoring, or discounting of levies. The arrear levies are ceded to STS by way of security, not sold.”

This approach ensures we are compliant with the Sectional Title Schemes Management Act, which allows a community scheme to borrow funds responsibly without compromising owners’ rights or property values.

Discounting or selling levies at less than face value could severely prejudice paying owners, and may even be viewed as negligent financial management. With arrear levy funding from STS, however, schemes can access up to 100% of their arrear levies, keeping operations running smoothly and fairly.

Our solution is designed with people in mind. It allows body corporates to support struggling unit owners through debt rehabilitation opportunities, while protecting those who are up to date with their payments from carrying the financial burden of others.

Here’s how everyone benefits:

• Paying owners are not penalised by subsidising others or facing unexpected special levies.
• Struggling owners get the breathing room they need to get back on track without facing immediate legal pressure.
• Trustees regain control over their scheme’s cash flow and can continue essential maintenance and repairs.
• The community scheme remains financially healthy and functional, safeguarding property values for everyone involved.

Best of all, there are no sign-up or initiation fees. Interest is added only to the arrear accounts, and repayment occurs when arrears are collected. This means the community scheme remains in control of collections while avoiding excessive legal fees.

Financial strain doesn’t have to mean financial collapse. With the right support and funding tools, owners, trustees and complexes can navigate tough times and come out stronger.

At STS, we’re here to help you restore financial balance and protect your community’s future. Contact us today to explore how our arrear levy lifelines can help your scheme thrive again, even in the most challenging economic climate.