What happens if you don't pay your monthly provision?

08 - 07 - 2016

In fact, you can compare the financial management of an apartment building (VME) to that of a commercial company. There must be revenue to cover the costs.

The earnings of a Homeowner Association (VME) mainly consist of the monthly provisions paid by all the owners. If owners do not pay these fees, there might be a shortage of money, due to which the necessary expenses cannot be covered anymore.

Unlike in the business world, the property manager that manages the finances will not allow large deficits. It's the property manager's job to make sure that any open invoices can be paid (e.g. if the invoices for the elevator, cleaning, etc. cannot be paid anymore, the involved companies will either refuse to further deliver services to the VME, charge higher costs for the overdue payments or charge higher prices in the future).

Even the supply of water, electricity and gas could be affected in exceptional cases.

If you do not pay your provisions on time, your fellow residents will suffer the consequences of non-payment. Since you are part of a whole (compare it to a family where everyone has to contribute), correct payments of every person are expected.

Moreover, the property manager will have to take responsibility and will have to follow up the defaulter. The property manager (usually) is mandated by the Homeowner Association to take the necessary steps – legal if needed – to encourage the defaulters to settle the payments. In case of non-payment you risk the legal costs and other costs (of an enforcement officer, collection letter fee, …). So, paying in time is a win-win for everyone.