What happens if a community is unable to pay its expenses due to lack of funds caused by owners not paying their levies? – Lisa, NSW

If the owners fail to pay their levies or delay paying them, it can impact the day to day common property management, administration, insurance, maintenance and repair schedules, and processing of council fees and so on.

If these delays and non-payments are happening frequently and depleting the funds, the owners corporation can raise additional fees against all lot owners, even those that have paid their levies and fees on time, and in full. The owners corporation has a legal obligation to meet these expenses and must have a process in place to follow up on unpaid fees.

Unpaid strata levies incur penalty interest in cases such as council fees and the owners corporation can recover the cost of these lapses from the debtors. They can charge an interest on unpaid levies, send follow up and warning notices, etc.

You may be interested in this article to learn more about paying strata levies.

If your owners corporation needs expert help with debt recovery, they can partner with debt collection agencies. Here’s an article on things to look for in a good debt collection partner that may be of use.