Policy Changes: Accounts Receivable, Bad Debt and Write Offs


The Finance committee has been hard at work creating policies and procedures regarding Accounts Receivable, Bad Debt and Write Offs. Below are revisions that were presented to the Board of Directors for approval and implementation. The Board of Directors approved the suggested revisions to the policy, they are below:


2.13 Accounts Receivables

(adopted 6/2020)

PURPOSE OF THESE PROCEDURES: These policies and procedures have been developed to fairly and equitably manage the Accounts Receivable associated with all RLCAR Members to ensure that everyone is paying their fair share of association expenses.


These procedures will apply to ANY AND ALL invoices sent to and payments received from RLCAR Members, regardless of what the billing purpose is ( e.g., association dues, MLS fees, classes, events, assessments, etc.)


It is the policy of the Association to forward an invoice no later than the day after the service is performed. A record will be kept of all accounts receivable or collections communications.


PAYMENTS NOT RECEIVED:

FIRST NOTICE is sent via email if payment has not been received within 30 days of the due date:

  1. A Reminder Email will be sent to the Member stating that the invoice is 30 (thirty) or more days Past Due and has begun accruing late charges of $50.00 monthly until payment is received.

Thirty (30) days after the date of the original invoice a notice will be emailed to past due members:

  1. It will be accompanied by copies of outstanding invoices.

  2. It will notice that the invoice is 30 (thirty) or more days past due.

  3. That a late fee + Gross Receipts Tax is assessed and due (see Appendix A, Dues Fees, Fines and Other Assessments).

  4. A late fee + Gross Receipts tax will be assessed every 30 (thirty) days the invoice remains past due (see Appendix A, Dues Fees, Fines and Other Assessments).

  5. Within this email the member will be provided with information on disputes, the dispute process, and the dispute form.

  6. The member will have 10 (ten) business days from the date of the email to dispute the invoice, all disputes must be on the Billing Dispute Form and substantiation/proof of their argument must be included when the Billing Dispute Form is filed with the Association.


If no Dispute Form is received, the charge will be considered valid, and the member will have forfeited their right to dispute this charge in the future.


Sixty (60) days after the date of the original invoice, if no Dispute Form was received within 10 business days and payment has not been received within 60 (sixty) days of the initial billing date: a second notice email will be sent to the Member and the Qualifying Broker will be carbon copied that:

  1. The invoice is now 60 (sixty) or more days past due.

  2. A late fee + Gross Receipts Tax is assessed and due (see Appendix A, Dues Fees, Fines and Other Assessments).

  3. A late fee + Gross Receipts tax will be assessed every 30 (thirty) days the original invoice remains past due (see Appendix A, Dues Fees, Fines and Other Assessments).

  4. has accrued late charges at a rate of $50.00 monthly since the date of the original invoice,

  5. The invoice is no longer valid eligible for dispute since no response was received from the first email past due notice.

  6. That Their membership with RLCAR and RLCAR MLS has been suspended and

  7. If a Qualifying Broker, the entire office is suspended as well.

  8. That they must contact the RLCAR Office by ______ date (at 90 days) to determine current amount due with accrued late fees and make payment or their membership will be terminated.

  9. Any member who is suspended or terminated will be subject to reinstatement fees.

  10. Invoices that are 60 (sixty) or more days past due will be assessed a $10.00 fee + Gross Receipts Tax for each collection invoice/correspondence sent via certified mail.


If ninety (90) days have elapsed without payment: If payment is not received by specified date member is terminated,

  1. A certified letter will be mailed informing the member that their membership with RLCAR and RLCAR MLS is terminated.

  2. The Qualifying Broker will be notified via email of the member termination.

  3. The Qualifying Broker will be advised of their options:

  4. May drop the licensee from their brokerage by removing the license from the NMREC records.

  5. If the licensee remains with the brokerage, the licensee will be considered a non-member salesperson and the Qualifying Broker will be billed an assessment fee for each nonmember licensee. This does not make the licensee a REALTOR® member (see RLCAR Bylaws, Article X, Section 2, Dues).

  6. The member may apply for reinstatement in a manner prescribed for new applicants after making payment in full of all accounts due as of the date of termination.

  7. If a Qualifying Broker, the entire office is terminated, as well.

  8. Any member who is suspended or terminated will be subject to reinstatement fees.


2.13.2 Disputes


  1. If A Protest Dispute Form was Received within 10 (ten) days (no payment made):

  2. The member will have 10 (ten) business days from the date of the email to dispute the invoice.

  3. All disputes must be on the Billing Dispute Form and substantiation/proof of their argument must be included when the Billing Dispute Form is filed with the Association.

  4. This will then be presented at the next meeting of the Finance Committee.

  5. If the amount of the outstanding invoice does not exceed $50.00, the Finance Committee will determine whether to accept or reject the Protest Dispute, and will either:

  6. Accept the Dispute: A Notice of Protest Acceptance will be emailed to the Member and the outstanding invoice written off, or

  7. Reject the Dispute: A Notice of Protest Rejection will be emailed and mailed via certified/return receipt mail to the member notifying them of such and that they must pay the total outstanding invoice, with late fees within 7 (seven) business days of the notice mailing, or their membership will be suspended.

  8. If payment is not received within that 7 (seven) days, their membership is suspended on the 8th day and the invoice written off.

  9. If the invoice remains unpaid at 90 days past due their membership will automatically terminate.

  10. The member may apply for reinstatement in a manner prescribed for new applicants after making payment in full of all accounts due as of the date of termination.

  11. Any member who is suspended or terminated may be subject to reinstatement fees.

*Each month the Board of Directors will be notified of any outstanding invoices under $50.00 which were protested and the ruling on each by the Finance Committee.

  1. If the amount of the outstanding invoice does exceeds $50.00

  2. The Finance Committee Chair will present the dispute with all substantiating evidence from the member and RLCAR association office to the Board of Directors at their next scheduled meeting for acceptance/rejection.

  3. The Board may rule at the time the dispute is presented or within 30 days of their notification of the dispute.

  4. The member will be notified of Board’s decision within 7 (seven) days of the Board’s ruling and given 7 (seven) additional business days to pay the outstanding fee and all accrued late charges or have their membership suspended on the 8th day, at which time the balance is written off.

  5. If the invoice remains unpaid at 90 days past due their membership will automatically terminate.

  6. The member may apply for reinstatement in a manner prescribed for new applicants after making payment in full of all accounts due as of the date of termination.


2.13.3 Bad Debt Write-Off


  1. All available means of collecting accounts receivable should be exhausted prior to initiation of write-off procedures.

  2. If RLCAR’s collection efforts are unsuccessful, the members account at 90 (ninety) days may then be assigned for collection to either legal counsel or a collection agency, or taken to small claims court, as the Board of Directors deems appropriate.

  3. Collection efforts will continue even after write-off, at 90 (ninety) days, until monies are collected or the attorney, collection agency or small claims court deems further efforts will be futile or not cost-effective.

  4. Write-offs shall be initiated by a written request presented to the Finance Committee.

  5. Bad debt write-off shall be maintained alphabetically by the member’s last name.

  6. All applications and reapplications for membership shall be conditional upon the write-off paid in full by the applicant.

  7. Although an uncollectible account is removed from the Association’s accounts receivable balance, the customer remains obligated to pay the outstanding debt.

  8. Staff shall check each application against the list.

  9. For accounting purposes, the write-off of an invoice will be treated as bad debt expense.

  10. The Finance Committee shall have the authority to write off outstanding invoices up to $50.00. Write-off requests over $50.00 must be presented to the Board of Directors for approval.

  11. Invoices written off that are dated during the current year will be treated as a reduction of the appropriate revenue accounts.

  12. Invoices written off that are dated prior to the current year will be treated as a bad debt.


2.13.4 Dues/Fees Accounts Receivable of Resigned Members


Members wishing to resign or cancel membership are required to do so in writing; if no notice is received, they will be considered terminated for non-payment of dues and/or fees and subject to reinstatement policies and fees.


Before Invoice Due Date: Members who notice the Association office of resignation of their membership before the due date of the invoice will prevent the assessment of late fees, their invoice voided and will resign as a member in good standing.


After Invoice Due Date: Members who notice the Association office of resignation of their membership after the due date of the invoice will have their invoice voided and will resign as a member not in good standing. The member may apply for reinstatement in a manner prescribed for new applicants after making payment in full of all accounts due as of the date of resignation. If late fees have been assessed, it will remain due and payable for any reinstatements.

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