How to Develop an HOA Capital Improvement Plan
Improvements are part of an HOA community, and over time different parts of the property may break down or need to be updated. This is a normal occurrence and can be handled well as long as there is a plan to accommodate the extra expenses.
If no planning has been set, this can be tough to manage, which is why it's imperative to create a plan that will meet your needs and be successful.
Let’s take a look at how to develop an HOA capital improvement plan!
Think About What Is Needed
The first step to coming up with a well-thought-out plan is to understand what capital improvement projects may be needed. This will consist of looking at items like plumbing, parking lots, or HVAC systems to understand when they need to be replaced or updated to keep them functional. Having a list of items approved by the board can help you create an outline to understand when capital funds may be needed.
What Will the Cost Be?
Your next step will be researching the costs for projects that are similar to the ones you are considering. At the same time, you can also look at things that could impact trends to help you get estimates for items that are on your list. This way, when you understand the costs, you can begin to create the plan to pay for the improvements, whether it is through a lender or reserves you may have on file.
How Will You Contribute?
Once you have organized the plan, you want to understand your options for funding all the items on the list. You want to create strategies that can help you save for these expenses, so if you do need to seek outside funding, you will be able to contribute in some way. If you do need to seek external sources for funding, having an organized plan will make you more apt to get the financing and reduce the amount of money you may need to borrow.
What About Unexpected Issues?
As you create the plan, you will also want to have a backup for contingencies. A general rule is to increase the amount of funding you believe you will need because this will help you be more prepared for any additional issues you encounter.
Keep It Streamlined
If you decide to move forward with getting funding, the last thing you will want to consider is being as prepared as possible. It can be helpful to get estimates for any work that you believe will need to be done and try to anticipate potential questions the lender may ask.
Professional Lending Services for Your HOA Needs
One part of HOA management is creating a living space that helps the residents feel cared for and at home, and there may be times when you need to consider HOA loans as an option. Trying to navigate the process might feel confusing, so HOA Capital is here to help you through the process. We offer HOA loan solutions designed to help streamline the process for your community.
You don't need to wait any longer to get those upgrades done! Contact us today or give us a call at 952-836-9593.