Delinquency Policy

Policy Statement

GHI members are responsible for the payment of their monthly co-op fees, which are due on the first of each month. A grace period is extended through the close of business on the tenth day of the month, after which a late fee is applied according to the terms of the Mutual Ownership Contract.

When requested, it is the cooperative's practice to attempt to work out payment plans with members who become delinquent due to extenuating circumstances. GHI staff will provide financial counseling or make referrals to appropriate agencies when requested.

Collection Procedures

The relationship between a member and GHI is not only a contractual ownership relationship, but also that of landlord/tenant, according to Maryland law. It can become a debtor/creditor relationship if payments are not made on time by the member. The Board of Directors is responsible for assuring that all financial obligations of the cooperative are met. It has the responsibility for collecting unpaid co-op fees from members by initiating court action to collect delinquent fees and/or repossess the member's unit.

Timeline

• 1st of the month: Payment is due
• 10th of the month: Grace period expires
• 11th of the month: Late fee applied & late notice sent (M-1) Letter
• 21st of the month: Statement of Account sent
• 11th of second month: Request for immediate payment & notice of intent to file in court (M-2) letter
• 21st of second month: Membership termination notice (M-3) letter Attorney notified to file complaint for possession

Relationship to Lender

GHI enters into an agreement with lenders, the Recognition Agreement, whereby each party agrees to notify the other if the member becomes delinquent in either the co-op fee or loan payment. GHI agrees, upon request of the lender, to exercise its powers to terminate the membership, and is obligated to assist in the removal of the member from the unit, where possible.

Right of Redemption

Under Maryland law, a member has a right to retain possession of the unit by paying to GHI an amount equal to the amount of the judgment (and costs of the suit). A member has this right before and after the judgment. Payment is accepted until such time as the sheriff begins the actual eviction. Note:Under Maryland law, the 'right of redemption' does not apply to any member who has received more than three court summonses for rent due in the twelve months preceding the current complaint.

Escalation Provision

The following shall apply to members for whom GHI has sent four M-2 letters within the previous twelve (12) months.

• 1st of the month: Payment is due
• 10th of the month: Grace period expires
• 11th of the month: Late fee applied and late notice sent (M-1) letter
• 21st of the month: Request for immediate payment and notice of intent to file in court (M-2) letter
• 11th of second month: Membership termination notice sent (M-3) letter Attorney notified to file Complaint for Possession

Adopted by GHI Board of Directors
16Nov06

Garage and/or Storage Space Rental

The Board of Directors has established a policy to address situations in which members are seriously delinquent in satisfying their financial responsibility to the cooperative and are renting garage and/or storage space. Members who are seriously delinquent will lose the privilege of renting garage and/or storage space from the cooperative. The policy specifically requires a member who receives an M-3 late letter to vacate all rented garage(s) and any storage space(s) within 30 days of the date of the M-3 late letter. Items that remain after that 30 day period will be removed by GHI or a contracted party at the member's risk and expense. Members who lose the privilege of renting garage and/or storage space from the cooperative would not be eligible to rent again until after demonstrating timely payment of all fees due to GHI for a period of six (6) consecutive months. After that time a security deposit may also be required. This policy will become effective August 1, 2010.

Adopted by GHI Board of Directors
15July2010