Maintenance defaulters are an unfortunate reality for almost every housing society. Whether it's due to negligence, financial strain, or simply unwillingness, unpaid dues affect the entire community. From delayed repairs and disrupted services to budgeting nightmares, the impact is real.

While most managing committees try to handle defaulters internally, many end up making avoidable mistakes that hurt both recovery and relationships. Here are the five most common mistakes societies make when dealing with maintenance defaulters — and how to avoid them.

1. Delaying Action or “Letting It Slide” Too Long

One of the biggest mistakes societies make is waiting too long to initiate recovery steps. Out of concern for relationships, many committees delay sending notices or taking formal action, hoping that members will eventually pay up.

Why it’s a mistake: Delays not only weaken the society’s financial position but also embolden habitual defaulters. The longer the wait, the harder the recovery — both legally and psychologically.

What to do instead: Create a timeline-based recovery policy and stick to it. Start with reminders, escalate to notices, and don’t shy away from legal recourse if needed.

2. Resorting to Illegal or Emotional Measures

Cutting off water, electricity, or lift access might seem like a quick fix, but it's illegal and can backfire legally and socially. Similarly, emotional appeals or public shaming rarely work and often lead to resentment.

Why it’s a mistake: Such actions can land the society in legal trouble and damage the committee’s reputation. It may also give the defaulter a reason to counter-sue or delay further.

What to do instead: Follow the due legal process under Section 101 of the Maharashtra Cooperative Societies Act, which clearly outlines the proper recovery procedure.

3. Taking It Personally

Managing committee members are residents too. When defaulters push back or argue, things can get personal. Many committee members end up feeling drained, demoralised, or even threatened.

Why it’s a mistake: Personal involvement often leads to communication breakdowns, increased tension, and hesitation in taking firm action.

What to do instead: This is where involving a professional third-party recovery partner like Finio makes all the difference. It allows the managing committee to remain neutral and emotionally detached, avoiding direct confrontations while still taking firm action.

4. Not Involving a Third Party

Many societies try to manage the entire recovery process in-house — sending notices, following up, filing paperwork — often without any legal expertise. While this might work in minor cases, it rarely succeeds when dealing with persistent defaulters.

Why it’s a mistake: DIY recovery is time-consuming, inconsistent, and lacks the authority and structure that professionals bring. Worse, it can dilute the seriousness of the society’s stance.

What to do instead: Hiring a third party like Finio signals seriousness. It shows that the society is committed to recovering dues the right way — and means business. Plus, the third party acts as a buffer between the committee and the defaulter, preserving relationships while getting the job done.

5. Ignoring Legal Tools Already Available

Many societies are unaware that they can recover dues without going to court. Thanks to Section 101 / 154B(29) of the Maharashtra Cooperative Societies Act, societies can file for recovery through the Registrar — a much faster and cost-effective process.

Why it’s a mistake: By not using this legal provision, societies lose precious time and continue operating in uncertainty.

What to do instead: Understand the power of Section 101 and how it enables the society to get a Recovery Certificate and take further action including seizure or auction of immovable property — all legally backed. Contact Finio here for more information on this.

Chronic defaulters don’t just affect your society’s bank balance — they chip away at trust and discipline in the community. By avoiding these common mistakes and choosing a professional recovery partner like Finio, societies can take back control — legally, respectfully, and effectively.

At Finio, we specialise in maintenance dues recovery using lawful methods under provisions of the Maharashtra Cooperative Societies Act, 1960. We do this all on a 'No Recovery, No Fee' basis. Let us do the heavy lifting while your committee focuses on building a thriving society.