All corporations, including homeowner’s associations, are required to file a registered agent name with their state’s Secretary of State. Registered agents receive all legal notices sent to a corporation, so it’s important to know who your HOA agent is and choose the right one for your homeowner’s association.
Why Is Your Registered Agent Important?
The responsibilities of a registered agent go beyond merely being a recipient of a letter or notice. An agent must be responsible and fully understand the significance of his/her role as a middle man.
Note that all legal notifications, lawsuits, and IRS notices are sent to the agent. Then, the agent should pass the documents along to the business owners, corporation leaders, or HOA management.
If the registered agent fails to give the files to the right people, it can cause serious legal issues for the corporation. For example, a notice of a lawsuit filed against a corporation may be sent to an out-of-date agent. If the agent ignores the notice, the legal proceedings will continue with the corporation not knowing anything about the lawsuit.
How to Find Your HOA Registered Agent
Surprisingly, many corporations don’t know their registered agent. If you’re not sure who your agent is, you can find them on the Secretary of State’s corporate search page. Search for your corporate name, and you should see the name of your registered agent.
You may realize that you don’t recognize the name of your agent. Others in your corporation also may not know the agent. This person might be:
a.) the attorney who set up the corporation
b.) a former association officer who is no longer involved with the association
c.) the previous owner who has moved or passed away
If you don’t recognize your registered agent, this could mean that important legal papers have been sent to someone who won’t deliver them to your corporation. In this situation, your corporation or HOA management should select a new agent as quickly as possible to prevent such cases from happening again.
How to Select an HOA Registered Agent
Now that you have a good idea of how important the role of a registered agent, know that selecting the right person for the job is just as important. There are two primary factors to consider:
a.) He/she must have a permanent address where the person intends to stay for a long time.
b.) This person should be trustworthy and responsible to quickly deliver all the documents he/she receives.
So, who can be the HOA agent for your community? Here are some people to consider:
1.) The Association’s Attorney
It feels like a no-brainer to choose your association’s attorney to receive legal documents and notices. After all, all legal concerns will be coursed through the lawyer, so you might as well send the documents directly to him. Upon receipt of the notice, your lawyer can immediately read the documents and advise you on the best course of action.
On the other hand, you should also consider that these documents are handed to the secretary or receptionist of the law firm or office, not the lawyer directly. The recipient of those documents may overlook them and not give them to your lawyer immediately, which will then cause more delay.
This is one of the reasons why lawyers do not want to be registered agents as it can create unnecessary conflict. However, if your association’s lawyer is up for the task, there’s no reason not to pick him/her as your registered agent, for an extra fee, of course.
2.) The HOA Manager or Board Member
Another easy option is to let the HOA manager or board member be the agent. These people are actively engaged in the association, so they might be willing to receive documents that will inform them of the association’s legal issues.
On the other hand, HOA managers and board members can have a lot on their plate already, so they won’t accept the role. Just bear in mind that when you change managers or board members, don’t forget to change the registered agent on file as well.
3.) Third-Party Service
If you think that your lawyer, HOA manager, or a member of the board does not pass the criteria of an agent, you may opt for a third-party service instead. Such companies offer a rate of around $50 to $100 a year to receive your legal papers and send them to you promptly. This can be a bit risky as people you don’t really know are receiving very important documents, but there are reputable and credible companies out there that offer quality registered agent services.
If you don’t know who your registered agent is right now, do the check and see if this person is still connected to your association. If not, it’s time to start selecting a new one to make sure you don’t miss any important legal document.
How CMG Can Help You Manage Your Community
Cedar Management Group has extensive experience managing HOAs located all over the United States. One of our strengths is integrating a viable strategy to manage your communities more efficiently with the optimum fiscal organization. By doing so, we can offer each community we manage to have satisfied residents who trust their CAM. In the long-term, this increases property values because the community has up-to-date repairs, looks attractive, and the HOA has a high approval rating amongst residents.
To learn more about how CMG can positively impact your community’s HOA Management, contact us online or give us a call at (877) 252-3327.