A condominium complex in Florida will have to face a class action lawsuit after publicizing the names of every tenant who was behind on payments. The Fifth District Court of Appeal on June 12 ruled against Salt Springs Resort Association, which posted a list of more than 100 names and the amounts they owed on […]
How to Make Outbound Calls to Collect Delinquent Assessments in Condos and HOA
In the effort to collect delinquent assessments in a condo or HOA, one of the tools used will be outbound calls. These calls to delinquent owners are very effective in that in some circumstances people are unaware that they are delinquent in their obligations to the association. Outbound calls to collect delinquent assessments in condos […]
Condo/HOA Collections 101: Community Association Assessments
Community Association Assessments refers to the regular amount owed to the association to cover the maintenance and upkeep of the community. Assessments might also be called Maintenance Fees, Condo Fees, or HOA dues. Read the article…………………………….
Memorandum of Association Assessment Lien (VA)
HOAs and condominiums continually chase after their members for unpaid assessments imposed for maintenance of common areas and amenities. Normally, a creditor who wants to go after a defaulting “customer’s” property or assets needs to sue them for a judgment if they want to record a lien in the land records. Association boards grew tired […]
9th Circuit Finds HOA Foreclosure Cannot Extinguish FHFA Interest (NV)
The Ninth Circuit relied on the Housing and Economic Recovery Act of 2008 (HERA) in ruling that Fannie Mae’s financial interest in a loan purchased in 2003 could not be extinguished by a foreclosure sale initiated by the property’s neighborhood HOA. This ruling is the most recent case in a number of cases over the […]
Condominium has options to recover unpaid assessments owed by deceased owner (FL)
Our small community (40 units) has a unit that was owned by an elderly woman who died with no relatives or heirs. She had a reverse mortgage with the bank; a neighbor and friend who was also a realtor who had control of the unit has died (and his business partner went to court and […]
Is This A Better Way to Conduct Board Meetings?
This Pandemic has been a horrific human tragedy, and by no means can there ever be a silver lining. At best, we’ve learned some lessons, and new ways of doing business have been established as viable. One of these things that we have learned is how we can improve community association board of director meetings. […]
What homeowners associations should do when residents can’t pay during the pandemic
The coronavirus pandemic has delivered a multitude of horrors around the world. Along with the personal toll the virus has taken on individuals and families, the pandemic’s impact has shaken nearly all sectors of American economic life, and community associations are no exception. Millions of homeowners were under stay-at-home orders within a community association, and […]
Should HOA Payment Plans Be Offered To Delinquent Homeowners?
Many homeowners associations have residents who are behind on their assessments. There are many ways to collect these late delinquent dues, one of which is by setting up HOA payment plans. Read the article………………………….
What homeowners associations should do when residents can’t pay during the pandemic
The coronavirus pandemic has delivered a multitude of horrors around the world. Along with the personal toll the virus has taken on individuals and families, the pandemic’s impact has shaken nearly all sectors of American economic life, and community associations are no exception. Millions of homeowners were under stay-at-home orders within a community association, and […]
9th Cir. Rules in Favor of Mortgagee Defendants in Nevada HOA Case
The U.S. Court of Appeals for the Ninth Circuit recently ruled in favor of the Federal Housing Finance Agency (FHFA), Fannie Mae, and the mortgage loan servicer in a title dispute arising from a homeowners’ association (HOA) lien foreclosure. Read the article……………………………
Florida’s Consumer Collection Practices Act (FCCPA) Part 1: Understanding the FCCPA
All businesses in the state of Florida need to be familiar with Florida’s Consumer Collection Practices Act (“FCCPA”). The FCCPA is found at Sections 559.55-559.785 of the Florida Statutes. The FCCPA is intended to protect consumers and is intentionally unfair to creditors. See §559.552, Fla. Stat. (2019); Kelly v. Duggan, 282 So. 3d 969, 974 […]
Indiana Community Association Finances & Assessment Collection
Board Members and property managers are looking for guidance through these historic times. Board Members need to continue to serve their Indiana communities as they are needed now more than ever with the ever-shifting economic climate. As we continue through this unprecedented journey, below are four factors to keep in mind. Read the article…………………………….
Why Does Bad Debt Happen In Community Associations?
In your Condo or HOA you are going to have delinquencies every month in good times and bad times. These are bad times and the delinquency rate is only going to increase to levels where hard choices by the board of directors need to be made. Read the article……………………………….
6th Circuit holds condo company and law firm did not act as debt collectors in non-judicial foreclosure
On May 4, the U.S. Court of Appeals for the Sixth Circuit held that a condominium management company, condominium association, and its law firm (collectively, “defendants”) acted as “security-interest enforcers” and not debt collectors and therefore, did not violate the FDCPA. According to the opinion, the homeowners lost their condominium to a non-judicial foreclosure after […]
Management Not a Debt Collector
The Bateses lost their condominium through a nonjudicial foreclosure. They claim the condo complex’s management company and its law firm violated the Fair Debt Collection Practices Act, which generally defines “debt collectors” to cover parties who operate a “business the principal purpose of which is the collection of any debts” or who “regularly collect[] or […]
South Florida HOAs and condo associations prepare for a drop in collections
With the first days of May ticking by, homeowners and condo associations are keeping a close eye on monthly collections. They’re preparing for nonpayment, as owners and renters struggle to pay their bills. More than 1 million people in Florida have filed for unemployment, according to figures released by the state. The tourism, hospitality and […]
Step-By-Step Guide To The HOA Assessment Collections Process
When you purchase a property in a community with a homeowners’ association, you’re also acquiring the obligation to pay regular assessments. Assessments aren’t necessarily a bad thing—they allow the HOA to operate for the community’s shared interest and to perform its core maintenance functions. Read the article…………………………..
Managing the Pandemic: Boards Must Balance Compassion with their Fiduciary Obligation to Protect the Community (MA)
Condominium owners must pay their common area fees. This is not a stop-the-presses revelation. It is a statement of principle, embodied in governing documents and affirmed by countless court decisions over the past 25 years. But the coronavirus pandemic, which has tested so many assumptions, is also challenging this one. Read the article………………………………
Is HOA & Condo Debt ‘Consumer Debt’?
There is some debate in the community association industry what type of debt delinquent assessment constitute. Is it a consumer debt like unpaid credit card bills? Or is it something else? Personal opinions vary, but the courts are clear, and their position is critical to how delinquencies are addressed and who should be tasked with […]
HOA Homefront – Can HOAs exercise leniency during hard times? (CA)
Amidst a statewide shutdown of all non-essential businesses, many homeowners are already feeling the pinch of reduced employment or business income, and calls are already arising in many HOAs for the association to be lenient regarding delinquencies. While emotionally the immediate response is to not push assessment collection, the matter is not so simple for […]
Case Law Update: Assessments are Consumer Debts Under the Florida Consumer Collection Practices Act
In a recent case, Kelly v. Duggan, 282 So.3d 969 (Fla. 1st D.C.A. 2019), out of Florida’s First District Court of Appeals looked at whether condominium association assessments qualify as “consumer debts” under the Florida Consumer Collection Practices Act (FCCPA). Read the article……………………………
New Nevada Decisions Confirm Additional Ways to Satisfy HOA Superpriority Liens
The Nevada Supreme Court again turned its attention to superpriority liens in the first quarter of 2020, issuing two opinions dealing with tenders, i.e. attempts or offers to pay. These decisions outline additional ways that the superpriority portion of an HOA’s lien can be satisfied, offering hope to lenders embroiled in litigation over the continuing […]
11 Ideas on How to Handle Assessment Collection at your Homeowner Association (HOA) or Condo Community during the Coronavirus Crisis
As the stay-at-home orders and business shut downs rock the nation’s economy and workers the impacts will increasingly be felt by community associations. This post is about how to handle assessment collection at your Homeowner Association (HOA) or Condo Community during the Coronavirus crisis. Read the article…………………………..
Rent Is Not the Same as HOA Assessments
For most people, a price is paid every month to maintain shelter whether for a house or an apartment. Some people pay rent for a residence and some people live in community associations (condos or HOAs). You either pay a landlord rent, or you pay the costs for owning your property (mortgage, maintenance fees, taxes, […]
Validity of Debts May Be Disputed by Oral Communication: Third Circuit Rejects Requirement of a Writing to Dispute Consumer Debt Under the Fair Debt Collections Practices Act
On March 30, 2020, the U.S. Court of Appeals Third Circuit issued an important decision in the case of Riccio v. Sentry Credit, Inc., approving oral communication as a method to dispute the validity of a debt. This decision overruled Graziano v. Harrison 950 F.2d 107 (3d Cir. 1991), a long-standing case requiring a writing […]
Fair Debt Collection Practices Act — debt qualification (IL)
Where a demand for attorney fees that arose from plaintiff’s actions as a board member of a condominium association did not qualify as a debt under the Fair Debt Collection Practices Act. Read the article………………………………
New Case Holds that Post-Petition HOA/Condo Assessments That Become Due After A Homeowner Has Filed For Chapter 13 Bankruptcy Are Also Dischargeable – Ouch!
As many of you likely know, when a homeowner files a Chapter 7 bankruptcy, they may be able to “discharge” their obligation to pay the pre-bankruptcy petition debts including the assessments they owe their community association. And you likely know that when an owner files a Chapter 13 bankruptcy, they are looking for a way […]
Condos and HOAs in the time of Virus and Recession
These are not the best of times, and maybe they are not the worst of times, but most certainly they are difficult times. Our health and prosperity are in harm’s way and our residences are on the line. For those of us who live in community associations (Condos & HOAs) these times are reminiscent of […]
7th Cir. Rejects Plaintiff’s FDCPA Arguments Regarding ‘Consumer’ Debt
The U.S. Court of Appeals for the Seventh Circuit affirmed entry of judgment on the pleadings against a former condominium association board director’s claim that the association’s attorneys’ request for fees in a separate state court action filed by the association against the former director violated the federal Fair Debt Collection Practices Act (FDCPA). In […]
Should HOAs Publish a List of Delinquent Owners? (PA)
I am not going to beat around the bush here: it is generally a horrible idea to “publish” a list of delinquent owners for others to see, even if the [usually decades old] governing documents in the community provide that it is permissible. This is even true if a delinquency list is not posted electronically […]
Is Publishing Your HOAs Debtors List a Bad Idea?
I’m not going to beat around the bush here. It is generally a horrible idea to publish a list of delinquent owners for others to see, even if the governing documents make it permissible. What if the delinquency information was viewed and used by a potential employer to deny an applicant? What if the delinquency […]
Bank Garnishment by the HOA (TX)
If you live in a planned community, chances are you are a member of its homeowners’ association. Upon inception, HOA members become legally bound to pay certain assessments, which help maintain the shared areas and amenities and contribute to the general upkeep of the community. Should you fail to pay the required assessments to the […]
Maryland Court of Appeals Bars Confessed Judgment Clauses in Consumer Contracts
A recent decision from the Maryland Court of Appeals provided somewhat surprising new guidance on the permissibility of confessed judgment clauses in consumer contracts. In Goshen Run Homeowners Association, Inc. v. Cisneros, the Court concluded that Maryland’s Consumer Protection Act (the “Maryland CPA”) prohibits all confessed judgment clauses in all consumer contracts. Read the article………………………….
An Introduction to Short Sales and Foreclosures for Community Associations
More than ever before, community associations are coping with financial shortfalls caused in no small part by the burst of the housing bubble and seemingly non-existent economic growth. Two issues which associations frequently encounter are short sales and foreclosures. This Blog post will discuss the implications of short sales and foreclosures as each relates to […]
Don’t Hesitate: Update Community Association Liens Now and at the Beginning of Each Fiscal Year (NJ)
This year community associations of all types saw a significant change to the law that applies to their right to secure payment for outstanding assessments through the filing of liens. Previously, only condominium associations had a priority lien against other lien holders for only six months of assessments prior to the recording of their lien. […]
Maryland court of appeals: state consumer protection act covers HOA collections
On January 27, the Court of Appeals of Maryland affirmed the dismissal of a homeowners association’s (HOA) confessed judgment complaint against a consumer, and stated that the HOA could not file an amended complaint. According to the opinion, the consumer owned a home that is part of an HOA, which makes annual assessments to cover […]
Maryland court of appeals: Law firm’s collection activities do not necessarily qualify for “professional services” exemption
On January 28, the Court of Appeals of Maryland held that not all services provided by a law firm or a lawyer fall within the “professional services” exemption under the Maryland Consumer Protection Act (CPA). In this case, a homeowners association (HOA) retained a law firm to collect delinquent HOA assessments, fines, penalties, and attorney’s […]
How Long Do Oregon HOA Liens Last?
Homeowner associations in Oregon are governed by the Planned Community Act, ORS Chapter 94. Under that statute, homeowner associations have an “automatic” lien on any lot that is delinquent on assessments or dues. The automatic lien exists without filing or recording a traditional paper lien in the county records. That said, in the event that […]
Board: Be Mindful of FCCPA When Collecting Past Due Condo Assessments (FL)
The ability to collect assessments from unit owners on a timely basis is a key component to the financial health and stability of a community association. An association’s governing documents, as well as the applicable community association statutes (i.e., Chapter 718 for Condominiums, Chapter 720 for HOAs and Chapter 719 for Co-Ops) provide several enforcement […]
6th Circuit Affirms Dismissal of Plaintiff’s FDCPA Suit over Law Firm Debt Collection Letters
The Sixth Circuit Court of Appeals affirmed the dismissal of a plaintiff’s complaint after it found that the plaintiff, who alleged violations of the FDCPA by a law firm that sent him two debt collection letters, showed no injury-in-fact traceable to the defendant’s challenged conduct, and therefore lacked standing to sue. Read the article………………………
A Checklist for your Condo and HOA Delinquencies
Are you tired of writing off bad debt each year? Want to recover all of the delinquent assessments from non-paying owners? It all starts with information and data. The first step to a good collections process is establishing a fact pattern and understanding what you can and cannot do, under the rules of the association, […]
Association Foreclosures Are Obsolete
In a condo or HOA the normal method to collect delinquent maintenance fees is to send an owner to the attorney. The attorney will then move the process through the courts. This means foreclosure for delinquent maintenance fees. The object is to foreclose and take “intervening title” on properties. Read the article………………………………
Is Your Association Set for a Financially Successful Year? (IL)
Many condominium and common-interest community associations are faced with a cash-crunch crisis when members fall behind in the payment of their proportionate share of assessments and common expenses. Associations are businesses, even if not-for-profit, that needs revenue to operate. Thus, it is imperative that Associations remain financially viable by collecting assessments. Read the article…………………………..
Obligation to Pay Assessments (NC/SC)
Homeowner dues (“assessments” by statute) are the lifeblood of an association. Most all HOAs and condominium are nonprofits. That is, community associations are not designed to make money; they are designed to pay the association’s bills. Associations basically act as agents for collections by other entities—water, garbage, electricity, landscaping. The funds collected are not kept […]
SC homeowners have fallen victim to companies exploiting HOA foreclosure loophole
South Carolina does not require including mortgage companies in lawsuits when homeowners associations foreclose over unpaid fees. Surrounding states, including North Carolina, Florida and Georgia, allow for HOA foreclosures but have statutes governing them. But in South Carolina it’s left to the courts’ discretion, said Columbia lawyer Brian Gambrell, who has a number of these […]
Court holds off on deciding case of Loveland woman foreclosed on by HOA (CO)
A district court judge said Thursday that she will wait to rule in the case of Loveland resident Martha Hummel, 70, who was foreclosed on by her homeowners association after severe depression rendered her homebound and her automatic dues payment system stopped working. Her “status quo” decision means Hummel will be allowed to keep her […]
How to Collect Difficult Homeowners Association Fees
When an HOA homeowner has failed to pay their fees, the board has a fiduciary responsibility to pursue collection of that money. The entire community depends on the benefits the dues pay for. If the board can’t pay for services that are expected by the community, there could be big problems. Read the article…………………………
SC home sold for $3,000 over late $250 HOA fee. Supreme Court calls that ‘unconscionable.’
They didn’t pay $250 in homeowners association fees. For that, one Midlands couple lost their home of 21 years. Unbeknownst to Devery and Tina Hale, their $128,000 house in Irmo was sold at auction for $3,000 in 2014. Read the article……………………………
Use Riders to Collect Delinquent HOA Fees
If you have purchased a condominium or property in an HOA you have signed a rider. For condos its called a Condo Rider. For HOAs its Called a PUD Rider. This rider is an attachment to the document recorded in the land records to secure the note given by the lender (aka mortgage). These riders […]