Q. I live in New Jersey but have a condominium in Florida. We have owned the unit for 23 years. Over the years we have had some heavy assessments. Recently we found there was money hidden in bank accounts and money markets funds since 2002. The sum added up to over $200,000 and none of the owners knew about the money. We only found it when one owner took time to read the end-of-year financial report. It seems none of the new board knew that this money was there. I asked for the end-of-year statement from the management company and the figures are in the report for all to see. It appears that no one on the board read the statement. So the question is, does the board have the right to conceal these funds and not disclose them to owners?

As owners, we only see the budget for the upcoming year and on that statement nothing is mentioned about these monies. Is the board guilty of improper actions?

A.T., Lake Worth

Financial statements with unaccounted funds or expenses are a common event in condominiums. My guess is that less than 10 percent of owners know how to read a financial statement. Your directors, all volunteers, are part of this group. Chances are good that no one on the board knows how to read financial statements. Is this a problem? Not if the board has professionals available to provide help, answer questions and make suggestions.

Your question is extremely important in that it points out a major problem in associations: most members do not concern themselves with the business of the association. They let others do the work with no oversight. All members have a responsibility to observe and evaluate the business decisions of the association. Members are responsible to attend meetings, follow the decisions of the board and read the financial statements. If it was found in the end-of-year statement, then the oversight was the members’ neglect as well as the board’s. Q. Our Home Owners Association Covenants and many others reference “FNMA Lending Guide, Chapter Three, Part 5, Insurance Requirements” regarding liability insurance and fidelity bond coverage. Where can I get a copy of this document? I called FNMA and they do not seem to know of this document. It does not show up on their website. Is this still a good reference?

W.F., Merritt Island

In simple terms, when a bank or mortgage lender takes a mortgage, they lend money to the seller. If that were the end of the story, banks and mortgage lenders would run out of money to lend. To help solve this problem, the government and private groups buy mortgages (secondary market) from the banks and lenders and give them money for them to lend again. This secondary market includes Freddie Mac, Fannie Mae (FNMA) and other secondary lenders. Their purpose was established to buy mortgages to re-enter money into the market. The Glass-Stegall Banking Act (GSBA) became law in 1933. That act regulated the banks to only allow certain lending and banking operations. At that time we had thrift banks, commercial banks, credit unions (1934), saving banks, savings and loan associations, and many other financial institutions. In 1999 the government deregulated banks by repealing the GSBA and many banks were allowed to conduct other businesses, such as insurance sales and stock transactions. These changes have resulted in several bank bankruptcies and failures.

Your documents refer to the FMNA mortgage application package because most lenders use those forms. It is not the law to use FNMA mortgage guidelines, just a policy —but your documents require it as a protection to future buyers and make obtaining a mortgage simpler.