SOUTHFIELD, Mich. (WXYZ) — Condo owners at a Southfield residential complex are planning legal action against their homeowner’s association over what they feel are oppressive increases in monthly fees.
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The Cumberland Condominium HOA assessments ballooned 63% last year, and residents are still reeling from the financial impact.
"The reaction was pretty much everybody was in shock when announced initially at the annual meeting," Audrey Brown said. "We had one co-owner say I don't know how I'm going to do this."
Some residents are now paying upward of $645 a month in HOA fees. The steep increase has resulted in liens on some properties for those unable to keep up with payments, while others, particularly retirees on fixed incomes, face difficult financial choices.
"Some people have had to sell their condos, some people may have lost their condos. Some people have to choose between medications and actually groceries," Veronica Cliett said.
The HOA claims the assessment increases were necessary because some electrical panels in the complex were outdated and posed a fire hazard. However, residents are demanding evidence.
"We want to see the mandate. They said they would show us that in one of our Zoom call meetings and they never came up with the mandate from the underwriters or insurers," Brown said.
Herb Dorow, an independent insurance agent representing Cumberland's HOA, explained that aging infrastructure is creating problems beyond just this community.
"We're not the only agency dealing with this. Cumberland certainly isn't the only community. This is an ongoing issue with older infrastructure," Dorow said.
According to Dorow, the association's previous insurance carrier dropped coverage due to claims history and concerns about old roofs, roads, buildings and electrical panels. He noted that insurance companies are increasingly reluctant to cover buildings with such issues, and those that do charge significantly higher premiums.
"Really what we see right now as the fix is to have them replaced," Dorow said.
The HOA's treasurer reports that approximately 75% of the problematic electrical panels have been replaced so far, which has reduced the association's insurance costs by $120,000.
Residents allege the HOA's legal team has harassed and sued them for organizing petitions, requesting additional insurance information to justify the rate increases and attempting to recall HOA board members.
When asked about these allegations, the HOA president provided a statement saying they are "the subject of pending litigation and they will be resolved in due course through the court system. Consequently, it would not be appropriate for me to comment on them at this time."
Some Cumberland Condo owners are now raising funds to cover costs for a legal fight to replace the HOA board.
