Community charge deposit

I have an appartment that I use as a holiday home. Until July 2011 the community fees were collected by direct debit. At the AGM in July there was a new president elected and a new administrator appointed. We are now being told that our community fees can't be collected by direct debit unless we have a 5,000 Euro balance in the bank account. This 5,000 Euro must remain in the bank and can't be used. Is anyone else having this deposit imposed by their bank?

I think YOU may have your WIRES crossed how can your PRESIDENT have control over your BANK ACCOUNT terms and conditions

DO you need to RE-PHRASE your QUESTION

Rod

 The deposit is being imposed by the bank. This has only happened since the change of president and administrator.

Do any other communities have to hold a deposit in the bank to be able to pay by direct debit? Any other payment method does not require this deposit.

I think you need to find out more. Your post makes little sense, and seems a little contradictory anyway. Whose bank must maintain a blance of 5,000€?  If the community's bank is saying the community must keep a balance of 5k, that would have nothing to do with an instruction by you to your bank to pay a direct debit.

I think this may have something to do with a retention period imposed by banks on funds received via DD. If the community claims payment from you via DD, you have a period of something like 15-30 days to dispute and reclaim this payment - which means the community then finds itself out of pocket (assuming the amount they claimed was correct and justified). To avoid communities paying money out for bills etc. using funds that in effect are not fully cleared (because payees can still claim their money back), the bank may not allow the community to access these funds for a period. For this reason perhaps your community is asking you to pay in cash instead. This sounds a bit shortsighted to me, however, as many owners (absentees for example) will not be able to do this. The solution is for the community to change bank. Our previous president changed the community bank (from Unicaja) for this exact reason to one not imposing a retention period (Banco Popular). Unfortunately, they instead levied virtually criminal fees and charges. As the current president I have just moved our account yet again (to BBVA) to reduce our banking costs while still avoiding this retention dilemna.

 Our administrator and president are saying that the bank has imposed the figure of 5,000 euros to remain in the community account if owners want to pay by direct debit. They say that this is because of the reclaiming of money paid in and then reclaimed. The bank in question is CAM bank. I have asked the president for evidence from the bank but I am told that it was just said face to face and not in writing. 

Which is exactly what I was referring to (retention)

I understand why some banks impose this retention - the paid in funds cannot be drawn on because the payee has a grace period in which to reclaim their money. But I really don't understand why the bank would refuse to accept direct debits unless a certain balance, or deposit is maintained. CAM bank of course has no money, so may be trying any desperate measures to get some in.

I would urge (and I mean with some urgency) the president / adminisrator to move the community account to another bank ASAP. If owners cannot pay by DD, many will simply have no way of paying and your community will go the way of so many others, even if it is involuntarily - down the pan for lack of funds.

This kind of blackmail by the banks is simply scandalous and should be illegal. There are enough problems in Spain with property issues already, and this kind of thing could be the nail in the coffin.

Please, speak to your president / admin and tell them they must change bank or face a disaster.