Private information, even for HOA residents, must be kept safe. HOAs who may need to collect that data are responsible for doing so. For this, you need to take the right steps and consider the right factors when handling HOA data privacy.
What is Data Privacy?
Also known as information privacy, data privacy is the notion that every person must have control over their own data. Part of that control is deciding how organizations, such as HOAs, can collect, keep, and use that information.
Many laws and jurisdictions recognize a person’s right to privacy and confidentiality. However, that right is at risk given how much easier it is to spread and access information today. In the wrong hands, personal data can easily be misused.
HOA Data Exposure: Why Protect Homeowners’ Data?
Residents in an HOA have much of their personal information shared with the HOA. Because of this, the HOA is responsible for keeping homeowners’ information, such as names, contact numbers, and addresses, private. Doing so protects your residents from fraud and identity theft. It also protects your association from liability.
Apart from the legal risks, an HOA that protects HOA data privacy also builds trust. More residents will see the HOA board’s integrity when its members protect their private information. When the opposite happens, trust and confidence will go down and even disappear.
HOA Privacy Policy
Typically, HOAs have guidelines for handling homeowner information. These are usually outlined in the HOA governing documents and, in some places, notable state laws.
Here’s a gist of what these policies may indicate.
Information Collected
When joining an association, homeowners need to submit their personal information to the HOA. Because of this, most HOAs actually collect more personal information than their members realize.
Some of this information includes basic personal details. These include residents’ names, addresses, phone numbers, and email addresses. HOAs collect these for record-keeping and communication purposes.
Apart from these, HOAs also collect financial data that they may have gathered for their own purposes. These may include bank accounts and credit card information.
What information most residents tend to forget that HOAs collect is the details of their stay at the HOA. These may include architectural request plans and property layouts from these submissions. It may also include sensitive information from legal correspondence and records. All these can put residents at risk if ill-meaning people gain access to them.
People with Access
Private data should be handled and shared only with the necessary people. These people are typically those who need them to fulfill responsibilities they have to the homeowner. As such, the board members must know who these people are and control who has access to the data.
The people who could generally have access to these pieces of information include:
- The board members collect information for the HOA as needed for day-to-day operations and resident services.
- Some HOAs hire a management company to help with association operations. In such cases, professionals from this company would also have access to resident details.
- Third-party professionals and contractors: The information shared with these people is limited. They should be given access to only the necessary data when residents need their services.
Handling Sensitive Information
Some of the data the HOA collects is extremely sensitive. These should always be kept confidential. For these, the HOA needs to go the extra mile and amp up its HOA data security practices.
But are there situations where the HOA would have to disclose private information?
There are, but HOA private data is usually shared only in very limited circumstances.
The first is when the data is needed to fulfill obligations. These would include providing contractors with a resident’s contact information. Usually, it is given with the homeowner’s permission, who needs the vendor’s service.
Another is in cases of emergencies. If there is a fire or a medical emergency concerning a resident, the HOA may need to provide contact information.
Lastly, the HOA may disclose a resident’s data if the law is involved. Some state laws require HOAs to submit certain records. Those may include a homeowner’s private data. Another situation this may apply to is when a court order requires it. This may happen when a resident is involved with legal proceedings or conflict resolutions.
Notable HOA Privacy Laws
In the United States, there is no overarching federal HOA data privacy law. However, its handling can be found within other legislation or state laws. Here are some to note:
Laws Related to Finances
Both the Fair Credit Reporting Act (FCRA) and the Gramm-Leach-Bliley Act (GLBA) contain provisions on how organizations should handle financial data.
- FCRA: This law outlines how the HOA should handle credit reports when evaluating possible renters and board member candidates.
- GLBA: This is only involved if HOA services require the involvement of financial institutions. It is in place to protect residents’ financial data. It also stipulates that the HOAs must provide homeowners with privacy notices before sharing information
State-Specific Legislation:
Some states also have local legislation that governs HOA data privacy. Some of them include:
- California: The California Consumer Privacy Act (CCPA) usually applies to homeowners and HOA vendors, not the HOA itself. It grants homeowners the right to access the private information that businesses have collected from them. It also gives them the right to delete them freely.
- New York: In this state, the SHIELD Act requires HOAs to have enough security measures that protect a resident’s personal data. It also outlines notification guidelines for HOA data exposure.
- Texas: The Texas Business and Commerce Code, Chapter 521, requires HOAs to implement measures to prevent identity theft. It also provides guidelines for data protection and information disposal.
- Virginia: The Virginia Consumer Data Protection Act (VCDPA) gives homeowners greater control over their personal information. It provides safeguards for information used by large HOAs or by those using technology and solutions that rely on resident data.
Avoiding HOA Privacy Violations: Best Practices
When handling homeowner information, the HOA can practice some of these tips to ensure they’re safe.
1. Only Collect Necessary Information
Yes, your HOA needs to collect information to function properly and fulfill your obligations to homeowners. However, as much as possible, limit the data to be collected. Only gather those that are necessary.
2. Limit Who Can Access Data
As much as possible, restrict access to private information. The fewer people who have access to it, the less likely for data to leak or be breached. Only the HOA board and designated personnel have access to it.
With this, you should also add additional safeguards to that access. These may include role-restricted access and two-factor authentication.
3. Set Retention Limits
The HOA should not keep private information forever. If a resident moves away from the HOA, set a limit on how long you can keep the records of their sensitive information.
4. Secure Data Storage
You need to ensure the security of your handling of private information. This applies to both digitally stored data and physical records.
For digital records, ensure your password is secure and not easily guessed. As much as possible, use two-factor authentication. You should also have encryption software to help store digital files and backups.
Meanwhile, physical records need to be stored at a secure location. It should be placed in cabinets with a lock and key. Also, store them in places where they can’t be unattended.
5. Train Personnel
To ensure data privacy is maintained, everyone in your HOA who handles it needs proper training. They need to know how to manage and keep them secure. It limits the possibility of breaches.
Keeping Things Private
As part of your fiduciary responsibilities, the HOA board must ensure that everything entrusted to it remains safe. This includes personal data. Strong HOA data privacy and security ensure that every resident is protected against potential wrongdoing if that data falls into the wrong hands.
HOA Explore offers a convenient way for community associations to find support from the right professional HOA management company. Use our online directory today!
Related Articles:
- Top Reasons To Consider HOA Living
- HOA Management Fees: What Is Your HOA Paying For?
- Homeowners Rights Against HOA And How Boards Should Respond
