An association’s collection policy sets forth the “association’s policies and practices in enforcing lien rights or other legal remedies for default in the payment of assessments.” (Civ. Code § 5310(a)(7).) Those policies and practices typically include the recording and foreclosure of assessment liens, obtaining money judgments, and suspending membership privileges.
The collection policy also sets forth the association’s policy for imposing late charges, interest, collection fees and costs, payment plans, the member’s right to dispute the assessment debt through internal dispute resolution (IDR), and the member’s right to request alternative dispute resolution (ADR). (Civ. Code § 5660.) The collection and foreclosure notice required by Civil Code Section 5730 is often attached or incorporated into the collection policy.
The collection policy is a required part of the association’s annual policy statement that must be distributed to the members within thirty (30) to ninety (90) days before the end of the association’s fiscal year. (Civ. Code § 5310(a)(7); See also “Annual Policy Statement.”)