How to choose a bank for condo and townhouse HOAs

Most condo and townhouse home owners associations use banks recommended by their management companies, but a fair share no doubt search the market for banks that will give them the best returns on their reserves and good deals on loans.

An HOA's banking needs are relatively simple.

You need a checking account that allows online banking, produces useful monthlly statements and provides access to the certificate of deposit and Treasury bill markets.

HOAs don't speculate in the stock or bond markets with their reserves or other excess cash.

The jobs of HOA directors is to preserve assets, not to grow them.

Thus, it makes pretty much sense to use the bank that an HOA's management company knows and uses so long as there are no conflicts of interest between the bank and the management company or members of the board of directors and basic banking needs are met.

Many HOAs, however, need loans to finance major maintenance and repair projects when their reserves are too low. Some banks specialize in lending to HOAs, and they should be considered by HOA boards.

Why do you need a bank that specializes in lending to HOAs?

The simple answer is that HOAs are run by volunteer boards who need special services and attention when it comes to lending to them. And the assets that HOAs put up as collateral are different than the assets and cash flow statements offered by other borrowers.

Some banks make it a point of being comfortable with lending to condo and townhouse HOAs, and some don't.

Snows challenge condo and townhouse HOA boards

Snow removal policies are always a challenge for condo and townhouse (patio home) HOA boards.

At what point do the sidewalks and driveways get shoveled and plowed. Some common issues include:

1. Does the HOA clear driveways as well as sidewalks?
2. Clear snow before it stops falling, regardless of depth?
3. Clear snown at 1", 2" or 3"?
4. Who calls for snow removal, or does the contractor come when he thinks it's appropriate?
5. Who decides that snow is heavy enough to bring in additional, expensive workers and equipment?

Condos hardest hit in weakest housing markets

Three real estate economists say condo prices are falling the most quickly, and by "condos," they probably also mean townhouses, if not patio homes.

Anyone trying to track the housing market will be interested in the wsj.com's Econoblog round table discussion.

Retirees looking for friendly condo communities, neigborhoods

The Wall Street Journal reports today that retirees are looking beyond Florida, Arizona and the mountains for communities that are friendly and comfortable.

Pickup today's paper if you don't have a paid subscription to wsj.com. The impact graphs for members of the boards of directors of condominium and townhouse HOAs:

But today, while weather and leisure remain important, retirees are telling builders, developers and researchers that they are looking primarily for what Mr. Lydens has found in Mount Airy: a community where they can make friends and connections quickly, whether it's a small town or a walkable neighborhood in a big city. A close second and third on the priority lists: a home that's near grandchildren, and a setting where one can indulge a post-work passion, such as a second career, a newly adopted sport or even, for a growing number of people, farming.

"Moving to a mixed-use development, a small town, or seeking an urban experience are all elements of the same thing: It's a community where you get to know each other," says John McIlwain, 62 years old, a senior resident fellow for the Urban Land Institute, a research group in Washington. He traded a Maryland suburb for a 1,000-square-foot loft downtown after his children left home. "You're walking around, and you get to know your neighbors, you get to know the shopkeepers, because you meet them on the street."