HOA Attorneys Serving All Of Michigan

Michigan Cooperative Lawyers Helping Understand Michigan Cooperative Law

Michigan Cooperative Law can be extremely difficult to understand. Housing cooperatives are different from condominiums in that residents do not own or hold title to their individual dwelling units. Instead, residents own shares of the corporation that owns the underlying real estate. Housing cooperatives differ from rental housing in that residents’ ownership of shares entitles them to a voice in running the association.

Conflict is inevitable within a cooperative due to living in proximity with others. Hirzel Law has a team of experts ready to help your cooperative Board better understand Michigan Cooperative Law through enforcing the governing documents and assisting with collections for monthly carrying charges.

How is a Michigan Housing Cooperative different than an HOA?

Many people confuse homeowners associations with co-ops, thinking they are interchangeable. It is important to know the differences before making living arrangements. A homeowner’s association (HOA) is an organization in a subdivision, planned community, or condominium building that makes and enforces rules for the properties and their residents. Those who purchase property subject to restrictive covenants become members and are required to pay dues, known as HOA fees. Some associations can be very restrictive about what members can do with their properties. Based on Michigan Cooperative Law, a co-op owner has an interest or share in the entire building and a contract or lease that allows the owner to occupy a unit. A co-op owner does not own the unit.

Co-ops are collectively owned and managed by their residents, who own shares in a nonprofit corporation. The corporation holds the title to the property and grants proprietary leases to residents. The lease grants permanent rights to residents to live in their units and to use the common elements of the cooperative according to the co-op’s bylaws and regulations under Michigan Cooperative Law.

What laws govern a Michigan Housing Co-op?

Michigan Housing Cooperatives are governed through Michigan Cooperative law:

• Michigan State Housing Development Authority Act of 1966
• The Michigan General Corporation Statute
• Michigan Nonprofit Corporation Act

A Michigan Housing Co-op’s governing documents can include Articles of Incorporation, Bylaws, an Occupancy Agreement and rules adopted by the Board. The Articles of Incorporation are filed with the state, are a public document, and can be amended by members. The bylaws are not filed with the state; but are available for inspection from the corporation

The Board of Directors govern a co-op through typical bylaws which hold power over the operating and policy decisions. Michigan Cooperative Law looks at the Board as fiduciaries and imposes the duty to act in the best interest of the membership. Boards are authorized to hire professionals and to rely on their advice.  You may ask the membership what they think. But the ultimate decision rests with the Board.

Co-ops are difficult to understand, and that is why an attorney experienced attorney in Cooperative law can help your Board through challenging issues that may arise.

How do you collect delinquent carrying charges in a Michigan Cooperative?

Almost all cooperatives charge residents a monthly carrying charge that is determined based on the co-op’s budget.

The most common collections problem occurs when members have temporary financial difficulties and fall behind on payment of carrying charges. The cooperative should have a procedure for assessing interest or late charges in such situations and a timetable to bring in legal action.

Individual monthly carrying charges or fees are usually based on a member’s equity or financial interest or on the size of the unit occupied. The collections policy should specify the schedule for payment, penalties for late payment, and procedures for collecting delinquent fees or initiating legal action. Occupancy by individual members is protected by a proprietary lease. But members are considered in violation of the lease if they fail to make payments. The lease should include the legal remedies available to the co-op to pursue payment and to evict the nonpaying member.

At Hirzel Law, our experienced collections team can help housing cooperatives with difficulty recovering debts they are owed from carrying charges.

The Right Michigan Cooperative Lawyers for Your Co-op’s Collection Needs

Hirzel Law represents cooperatives in carrying charge collections throughout the State of Michigan. At Hirzel Law, our cooperative lawyers are here to get results and relieve your cooperative of the debt collection burden. Our cutting-edge thinking keeps us on top of the latest trends in cooperative law. As a result of our exceptional legal skills, the attorneys at Hirzel Law have garnered numerous awards from Best Lawyers, the Community Association Institute’s College of Community Association Lawyers, Leading Lawyers, Michigan Top Lawyers, and Super Lawyers. Our Michigan cooperative lawyers are known for client education and highly responsive customer service.

Contact Our Cooperative Lawyers for Help with Monthly Carrying Fee Collections

Collecting delinquent cooperative fees is not fun for co-op boards, but it is necessary to provide required services. At Hirzel Law, PLC, our Michigan cooperative lawyers can help your Michigan cooperative resolve its delinquency issues. We stand by our clients, offering the highest quality legal representation and promptly responding to our clients’ needs.

Contact Hirzel Law online or call 248-986-2921 (Farmington) or 231-486-5600 (Traverse City) or 616-319-9964 (Grand Rapids office) to see how our Michigan cooperative lawyers can collect carrying charges on your Michigan cooperative’s behalf.