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Union Bank Money Market and CD Promotional Rates through Dec. 31, 2018

Union Bank HOA Services has extended its offering of VERY competitive rates for your reserve funds.  These new rates also include a surety bond to cover any funds over the $250K FDIC Insurance.  This special is only available for new funds coming to Union Bank from an outside bank or investment fund.  For the Money Market account the rates are good for one year.

For more information, view the Union Bank HOA Reserve Promotions flyer below:

Why Do We Need Reserves?

Equipment and major components (like the roofs) must be replaced from time to time, regardless of whether we plan for the expense. Living in the Carolinas you could experience weather damages, which can be pretty expensive, if you haven’t set the money aside ahead of time. We prefer to plan and set the funds aside now. Reserve funds aren’t an extra expense—they just spread out expenses more evenly. There are other important reasons we put association monies into reserves every month:

  1. Reserve funds meet legal, fiduciary and professional requirements. A replacement fund may be required by:
  •  Any secondary mortgage market in which the association participates (e.g., Fannie Mae, Freddie Mac, FHA, VA).
  •  State statutes, regulations, or court decisions.
  •  The community’s governs documents.
  1. Reserve funds provide for major repairs and replacements that we know will be necessary at some point in time. Although a roof may be replaced when it is 25 years old, every owner who lives under or around it should share its replacement costs.
  1. Reserve funds minimize the need for special assessments or borrowing. For most association members, this is the most important reason.
  1. Reserve funds enhance resale values. Lenders and real estate agents are aware of the ramifications for new buyers if the reserves are inadequate. Many states require associations to disclose the amounts in their reserve funds to prospective purchasers.
  1. The American Institute of Certified Public Accountants (AICPA) requires the community association to disclose its reserve funds in its financial statements.


Professionals Hired to Conduct Reserve Study

Our association has hired a professional reserve study provider to conduct a reserve study for our association.

A reserve study is a complex document that projects when numerous major components—like the roof, parking lot or tennis court—will need to be replaced, what they will cost and how much we need to set aside each year to pay for the various components at the necessary time. Preparing it requires a unique combination of specialized engineering knowledge, a keen understanding of financial projecting and savvy investing skills.

Professional reserve study providers are extensively trained before they are considered qualified to perform competent reserve studies tailored for each community. These professionals have met stringent requirements and are held to high standards. They have a thorough knowledge of common interest developments, HOAs, and community associations, and can provide the board with sound guidance.

We prepared a request for proposal that specified the reserve study must conform to the National Reserve Study Standards of the Community Associations Institute and our state law.

The board takes its fiduciary responsibility very seriously—we want to be good stewards of your money. By hiring these professionals we’re confident we’ve done the right thing.