|
QUESTION:
Subject: HOA Liens
Question: Our association has a lien on a foreclosed property. The property is listed at about $350,000. The owner who defaulted paid about $650,000. Will the association get any of the moneys it leaned (association dues, fines, etc.)?
ANSWER: Hi;
Thanks for writing - right off the bat, I want you to know that I can't answer with your question with certainty because i don’t' have all the facts (many of which could change the outcome). Even so, as a consumer advocate, I will do my best based to answer your question, based on the way it was asked in your letter.
Personally, I believe there are two issues here. The first is someone who is being forced into foreclosure, while the second is with someone who gives back their homes voluntarily to the bank. I believe in either situation though, the results can and will be the same.
Foreclosure: As a betting man myself, I would bet the correct answer here would be "NO"for several reasons. the largest is that if the person who owns the home/property is forced to file for bankruptcy, most likely his debts will be dismissed. if that is so, and the association is listed, then all outstanding debts will be dismissed, including those with the HOA.
Additionally, along these lines, one has to ensure that the lien was placed properly, including providing the home owner with Due Process and the opportunity to protect themselves in court.
Second, if the property is voluntarily remitted to the bank, the question becomes many fold, with the largest being are there any outstanding fees, interest, or insurance, as well as other fees that would probably come before yours? Not knowing this makes it hard to tell.
As you can see, the root here is this: the owners ability to pay, followed by his/her legal actions to protect themselves. In either instance, that is often an emotional decision and I have tried to provide you with the legal background. And that legal background, combined with 30 years of consumer protection experience is NO because there is no money to go after, and the HOA will be throwing good money after bad.
I hope this helps.
|
