Due to COVID-19 you can now work through foreclosure by phone. No office visit is required.
Condo and homeowners’ associations have the right to foreclosure on your property if you do not pay your dues. The first step is for the association to place a lien against the property for unpaid dues. The next step is for the association’s lawyers to foreclosure that lien. The result of an association foreclosure is the same as that of a bank: Your home will be sold and you will be evicted from it.
In our practice, we have found association foreclosures to be harder to defend. The fact that your association is not providing a service or that the service is substandard is not a defense to foreclosure. The law is very clear: If you live in the community, you have to pay the fees. If you don’t like what the board is doing or how it is directing the affairs of the community, your remedy is to vote it out, not withhold dues.
As there are relatively few defenses to an association action, they tend to move faster than mortgage foreclosures. In our practice, we have lost more homes to associations than to banks.
Even worse, the association’s lawyers charge you for the time they spend working on your case. A simple collection letter could cost as much as $250! We have seen association cases in which more than 60% of the total costs were related to attorney’s fees, late fees, and interest. What was normally a small monthly expenditure had morphed into a major financial burden and a major windfall profit for the association’s lawyers!
Associations are now becoming nasty with owners who do not pay. They are limiting access to community areas, forcing non-paying residents to drive into the community through the visitors line, and even cutting off cable television. A new law requires tenants to turn over their rent money to the associations when the landlords are behind in payments.
Remember: the “association” represents the community in which you live. Your neighbors are probably struggling just like you are to pay their fees. The burdens on the community members who are paying increases every time that one of their neighbors stops paying. Your association has not been bailed out by the federal government like the big banks. In fact, many associations are on the verge of bankruptcy themselves. Simply put, the associations are desperate. They need you to pay.
For all of the reasons above, our standard advice to clients who live in associations is to pay their association fees, even if they are in foreclosure.
If, however, you fall behind in those fees and you are facing foreclosure, our firm can help you reach an agreement with the association to enter into a payment plan to stop the foreclosure. We offer this service for a low, flat-rate fee.
A successful negotiation of the outstanding dues represents a win for everyone: the homeowner gets to keep his/her home and the association gets paid.