A divided panel of the North Carolina Court of Appeals holds that a good-faith purchaser for value at a foreclosure sale obtains a valid deed regardless of the amount paid, even where the foreclosure itself is void due to procedural errors. Read the article………………………
A community’s last resort: Foreclosing on a home
Nobody wants to foreclose on a home—not a mortgage banker and certainly not a community association. Countless Americans lose their homes when lending institutions are unable to collect mortgage payments. In a perfect world, no one would ever face foreclosure—for any reason. Read the article………………….
Condominium Assessments and Bankruptcy: What Can Associations Collect?
Courts across the nation are split on whether post-petition community association assessments constitute dischargeable debts under Chapter 13 of the U.S. Bankruptcy Code. To make matters worse, in November, the Supreme Court denied a petition to review the issue, leaving the community association industry wondering if the existing dispute among the courts will ever have […]
6 Steps to Improve Your Condo and HOA’s Collection Practices Before the Next Recession
We’re all aware that the economy has a rhythm or cycle and is also referred to as a business cycle. When the cycle is on an upward trajectory people’s financial situation is improving and as the cycle turns downward their financial situation can deteriorate. The U.S. is experiencing the second longest economic expansion in post […]
A Brooklyn Luxury Condo With Monster Arrears (NY)
There are arrears. And then there are serious arrears. And then there are absolute monster arrears like those racked up by the Chinese developer, Xin Development, at the Oosten, a 216-unit luxury condo building in Williamsburg, Brooklyn – a cool quarter of a million dollars or, to be precise about it, $252,752.23. Read the article………………..
New Hampshire Condo Associations Need Foreclosure Authority to Make the Superlien Effective for Them
If you look at a list of states that have a condominium superlien, you will find New Hampshire among them. But you can’t judge a book by its cover – and you can’t judge a statute by its name. All superliens are not equal. And the New Hampshire superlien includes some differences of which New […]
Law Firm Not a ‘Debt Collector’ Under FDCPA, says Fifth Circuit
A law firm not specializing in debt collection activity is not a “debt collector” under the Fair Debt Collection Practices Act because it was not “regularly” engaged in debt collection, according to the U.S. Court of Appeals for the Fifth Circuit. The case is Reyes v. Steeg Law. Plaintiff Nicole Reyes filed a class action […]
When Does Interest Accrue on Delinquent Assessments? (FL)
The ability to collect interest for delinquent assessments is found in a community associations governing documents and is also recognized in Fl. Stat. Chapters 718 for condominium associations and 720 for homeowner associations. Specifically, section 718.116(3), Florida Statutes for condominium associations provides in part that unpaid assessments shall bear interest from the due date until […]
Super-Priority Issues Linger in D.C.
With the issuance of its decision in Chase Plaza Condominium Ass’n v. JP Morgan Chase Bank, N.A., 98 A.3d 166, (D.C. 2014), the Court of Appeals for the District of Columbia upended the established manner in which condominium liens have been handled in the District. In Chase Plaza, the court interpreted D.C. Code §42-1901 and […]
Coop and Condo Right to Seek Legal Fee Reimbursement may have new life (NY)
As we previously reported, the New York Appellate Court that oversees the Manhattan and the Bronx Supreme Courts issued a unanimous decision at the beginning of November, 2018, which may significantly impact the right of cooperatives, and likely condominiums, that try to seek the reimbursement of legal fees from defaulting shareholders or owners. In Krodel […]
“Pay Up Or Else!” — Motivating the Habitual Late Payer
As every manager knows, collecting everyone’s fees is crucial to an HOA’s success. Every homeowner in your association agreed to pay the fees when they moved in. (Hint: most HOAs have better luck collecting payments online as opposed to checks.) But each and every month, every HOA in existence deals with late payments. There are […]
HOAs Get Tough on Delinquent Residents
Leah Lally, a 51-year-old homeowner in Tampa, Fla., learned the hard way that dealing with a homeowners association (HOA) can escalate into a costly and years-long legal battle. In 2015, Lally got nearly $700 behind on the $135-a-month association fees on her five-bedroom home. She explained to the association’s management that she faced financial hardship […]
Coop and Condo Right to Seek Legal Fee Reimbursement at Risk (NY)
The New York Appellate Court that oversees the Manhattan and the Bronx Supreme Courts issued a unanimous decision at the beginning of November, 2018, which will significantly impact the right of cooperatives, and likely condominiums, that try to seek the reimbursement of legal fees from defaulting shareholders or owners. In Krodel v. Amalgamated Dwellings, the […]
HOA Statute of Limitations
If you live in a home, condo, apartment, or dwelling that is part of a Home Owners Association, you already know that you are required to pay HOA dues each month, as well as certain special assessments while you reside in the association. While they are necessary to proper maintenance of the association’s collective properties, […]
Appellate Ruling Limits Viability of Blanket Receiverships (FL)
Lack of proper notice was central to the Third District Court of Appeal’s decision in Federal National Mortgage Association v. JKM Services, LLC, Case No. 3D17-370 (Fla. 3d DCA October 3, 2018) limiting a receiver’s ability to recover fees and costs incurred in his efforts to collect rent after having been appointed by a condominium […]
WA Court: HOAs May Record Liens Without Providing Owners With Notice and Hearing
Collecting past due assessments can certainly be scary sometimes. After one homeowners association recorded a lien on a delinquent property and obtained a judgment against its owners, they appealed to the Washington Court of Appeals. The court ruled that the association was permitted to record the lien without providing the owners with notice and an […]
Are there delinquencies your board of directors does not want to address?
If you have an “elephant” in the board room of your condo or HOA, it’s most likely that the elephant is delinquencies by other owners in the association. Let’s be honest; sometimes it’s just easier to let your neighbors get away with not paying their fair share, than it is to bring these issues to […]
Collections Corner: Filing Of A Lawsuit (MD/DC)
This month we are highlighting the process of filing a lawsuit to obtain a judgment against a delinquent homeowner. After a lien is filed, we generally send a lien notification letter to the delinquent homeowner advising him or her that a lien has been filed against the property and; further, if he or she fails […]
HOA Liens and How to Handle Them as HOA Board Members
“HOA Liens? What are those?” It’s a question lots of board members ask, so if you’re wondering as well then you’re not alone! In this post we’ll take you through a brief overview of HOA liens—what they are, what they impact, and how to remedy the situation as a board member. Read the article………………
Fraudulent Transfers 101: What You Need To Know When Following The Money Trail (FL)
The debt collection process is based upon a creditor’s right to repayment from the liquidation of a debtor’s assets. In Florida, there are many judicial procedures available, which allow creditors to identify, seize, lien, levy and force the sale of a debtor’s assets in order to satisfy the indebtedness owed to the creditor. Unfortunately, many […]
Collection Procedures Reviewed (FL)
Q: I was recently appointed as the treasurer of my association. I noticed that there are a couple of unit owners who have not paid their condominium fees for over a year. I asked the other board members what they have done about the delinquent owners, and they basically shrugged their shoulders and said that […]
Collection Best Practices for Condo Communities & HOAs
Ever feel like your association budget would be just fine if it didn’t have to deal with unit owners that didn’t pay on time? When some people don’t pay it can cause a lot of stress on your community’s budget. To help we’ve put together a list of collection best practices for condo communities & […]
Ask the HOA Expert: What Is An Executive Session
Question: What is the definition of an “executive session”? Can a meeting begin as an executive session, and end as an open session, or vice versa? Read the Q&A……………
South Carolina Court Affirms Lien Foreclosure
A recent class action lawsuit in the U.S. District Court of South Carolina served as another chapter in the national debate of the legality of lien foreclosure for community association assessments. In January 2018, seven South Carolina real estate owners in community associations, sued not only their seven associations but also six management companies and […]
How Florida Condominium Law Impacts Collection Of A Condominium Assessment By Florida Condominium Associations
Florida condominium law is ever-evolving. As a result, an effective condominium law attorney can help ensure condominium associations are able to collect an overdue condominium assessment from each unit owner. In this video presentation recorded by Hans C. Wahl, he explains how our laws govern a Jacksonville Florida condominium assessment by a condominium association, as […]
Collect What is Due: Effective Association Collection Strategies and Policies (FL)
One of the most consistent challenges for condominium association boards in Florida is receiving dues and assessments in a timely fashion. Therefore, it is vital for a COA or HOA to apply effective association collection strategies as part of their management activity. This video presentation recorded by attorney Brittany N. Snell outlines effective association collection […]
MI Court rules that MCL 559.208 does not protect a Condominium Association’s lien priority after taking a deed in lieu of foreclosure
In Stonehenge Condominium Association v Bank of New York Mellon Trust Company, NA, unpublished opinion of the Court of Appeals, issued July 24, 2018 (Docket No. 339106), the Michigan Court of Appeals held that a condominium association’s lien priority over a second mortgage was extinguished when the association received a deed to the condominium unit […]
What is a Contest of Lien, and How Does My Association Respond To It? (FL)
You’re the President of a condominium association or an HOA. You’ve had a problem owner for years—someone who doesn’t pay his assessments. Or when he does, payment is late and he incurs penalties and interest, and then later fights those penalties and interest. The owner is basically a drain on the association’s budget and time, […]
Nevada Courts Provide Additional Guidance on HOA Super Priority Lien Law for Lenders
As we’ve discussed on this blog before, Nevada’s courts remain a battleground for lenders seeking to establish that their security interests were not eliminated by homeowners’ association foreclosure sales under NRS 116. In recent weeks, the Ninth Circuit and Supreme Court of Nevada have issued new opinions providing more guidance to ultimately resolve those issues. […]
Oops! Who’s on the Hook for Eight Years of Unbilled Fees? (NY)
Most co-op and condo boards rely on the vital income from various fees – for parking, sublets, and the storage of bikes and other belongings. But at a tight-knit, 15-unit co-op in Manhattan, the board recently discovered that one shareholder has never been charged for his storage space, which costs $40 a month. His eight […]
9th Cir. Holds Judicial Foreclosures Are Debt Collection Under FDCPA
A panel of the U.S. Court of Appeals for the Ninth Circuit recently held that a law firm’s effort to collect homeowner association (“HOA”) assessments through judicial foreclosure constitutes debt collection under the federal Fair Debt Collection Practices Act. In so ruling, for purposes of whether activity constitutes debt collection under the FDCPA, the Court […]
Condo Association Liens Can Step In Front of Second Mortgages (IL)
Most condo associations know that there is a process through which they can receive up to six months of assessments plus legal fees and costs in the event they institute an action to collect assessments and the property goes through foreclosure. What many of them do not know is that the condo association’s lien can […]
How to formulate a Uniform Collection Policy
All Community associations need a UCP (Uniform Collection Policy), but they are not as easy to formulate as you would think. Here are some suggestions on how to go about putting together a UCP and, more importantly, enforcing it: The first thing that has to be done is for the board and manager to read […]
CONDO & HOA COLLECTIONS… How to formulate a Uniform Collection Policy
All Community associations need a UCP (Uniform Collection Policy), but they are not as easy to formulate as you would think. Here are some suggestions on how to go about putting together a UCP and, more importantly, enforcing it: The first thing that has to be done is for the board and manager to read […]
New Maryland Law Facilitates Ability Of Condos To Suspend Common Element Privileges As A Means Of Collecting Delinquent Condominium Assessments
The Maryland legislature recently made it easier for condominium associations to amend their declarations to authorize the suspension of common area parking and recreational facilities of unit owners whose delinquent condominium assessments are more than 60 days in arrears. Under prior law, a minimum of 80% or greater was required for such an amendment. The […]
Associations May Be Able to Recover Six Months of Unpaid Assessments From Foreclosure Purchasers Without Filing Suit Against the Former Owner (IL)
On June 4, 2018, the Appellate Court issued its opinion in Sylva, LLC v. Baldwin Court Condominium Association, Inc. (“Sylva”) holding that the “initiation of an action” requirement in section 9(g)(4) of the Illinois Condominium Property Act (“ICPA”) may be satisfied even when an association does not file suit against the former owner. This expansion […]
Do Judgments Ever Expire? (NC)
Suppose you were awarded a money judgment against an opposing party but, not surprisingly, the defendant didn’t immediately write you a check to satisfy the debt. How long is your judgment valid? In North Carolina, a judgment is valid for ten years from the date it was awarded by the Court. The judgment can be […]
Why Your Association Needs to Compel Release of Mortgage Information When a Unit Faces Foreclosure (FL)
Board members of any condominium association are no doubt familiar with the following scenario: a unit owner gets behind on his assessments and refuses to bring his balance current; the association records a lien against the unit and, when that still doesn’t motivate the owner to bring his balance current, files suit to foreclose the […]
FDCPA & Debts That Can Cause Despair
The Federal Fair Debt Collection Practices Act (“FDCPA”) 15 U.S.C.A. § 1692, et seq. applies to attorneys engaged in the collection of debt for community associations. The language contained in demand letters is a frequent source of FDCPA litigation. Liability is often imposed based on certain words contained in or omitted from the letter. Read […]
Orange County Mandatory Residential Foreclosure Mediation Extended to Include HOA and Condominium Foreclosures (FL)
At the peak of the mortgage foreclosure crisis, Orange County implemented a mediation administrative order applicable to mortgage foreclosures. The mediation program was set up through the Orange County Bar Association – a not for profit organization that is capable of effectively managing a large number of mediation referrals. The program was designed to promote […]
HOA Assessment Collection in Maryland
The timely payment and collection of homeowner association assessments is essential to an association’s financial well-being and efficient operation. The association’s Board of Directors has a fiduciary responsibility to stay on top of assessment collection so that delinquent assessments do not accumulate, depriving the association of needed operating capital. This article provides an overview of […]
Stepping Up The Pressure: Using a Judgment Creditor’s Suit to Enforce an Association’s Lien (VA)
In a previous post, we discussed the advantages and disadvantages of a memorandum of lien foreclosure. In this post, we will focus on the process of enforcing an Association’s judgment lien. When an Association sues a delinquent owner, the Association seeks a monetary damages award (plus attorney’s fees and costs usually) from a court. If […]
Illinois App. Court (1st Dist) Rules HOA Lien Extinguished by Payment 1 Year After Foreclosure Sale
The Appellate Court of Illinois, First District recently held that a foreclosing mortgagee’s payment of post-foreclosure sale assessments nearly a year after the sale date confirmed the extinguishment of a condominium association’s lien for pre-sale assessments created under the Illinois Condominium Property Act. In so ruling, the First District found that the plain language of […]
Continuing Developments in Nevada HOA Lien Litigation
Recently, in Nationstar Mortgage, LLC, vs. Saticoy Bay LLC Series 2227 Shadow Canyon, the Nevada Supreme Court issued a decision following a line of cases stemming from the analysis in SFR Investments Pool, LLC vs. U.S. Bank N.A., which holds that non-judicial foreclosures by homeowner associations (HOAs) can extinguish a first deed of trust. In […]
Washington D.C. Appellate Court Holds Foreclosing Condominium Association Might Not Have Super-Priority if It Forecloses on More Than Six Months of Dues
The District of Columbia Court of Appeals recently reversed a lower court’s decision granting summary judgment to a condominium association and held that the association’s foreclosure of a “super-priority” condominium lien may not have extinguished an otherwise first-priority mortgage on the property. See U.S. Bank Nat’l Ass’n v. Green Parks, LLC, No. 16-cv-842 (D.C. Mar. […]
Persistence Can Lead to Dollars Part II: Foreclosing on a Memorandum of Lien (VA)
In our previous post, we considered one method a Community Association may use to preserve and collect its lien for unpaid assessments: the memorandum of lien. In this post, we will focus on the process of foreclosing on a Community Association’s memorandum of lien. As we discussed last time, once the memorandum of lien is […]
Foreclosure/Writ of Execution (MD)
This month we are highlighting the process of determining whether a delinquent homeowner’s account should be considered for a statutory foreclosure or writ of execution (sometime commonly referred to as a Sherriff’s Sale). Either a statutory foreclosure or writ of execution divests the current non-paying homeowner from title to the property and, as such, are […]
Curing Arrears: When Fees Aren’t Paid
The last three apartments in your luxury hi-rise condo were sold to a troika of Russian oligarchs, who all paid well above the asking price. But now those oligarchs are on the sanctions list, and have withheld their monthly maintenance fees for six months and counting, while waiting out the situation at their Black Sea […]
Philly condominium complex seeking over $19K in unpaid assessments, fees from tenants (PA)
In a new lawsuit, a Philadelphia-based condominium group is seeking unpaid damages exceeding $19,000 from two of its residents connected to allegedly-unpaid assessments and other charges. Park Plaza Condominium Association of Philadelphia filed suit in the Philadelphia County Court of Common Pleas on March 28 versus Joel Jaffe and Bonnie Jaffe, also of Philadelphia. Read […]
Association Collections Policies Clarified by Court Decision (IL)
In Lake Point Tower Condominium Ass’n v. Waller, 2017 IL App (1st) 162072, decided on June 28, 2017, the Association filed a Forcible Entry and Detainer action against Defendant to obtain possession of Defendant’s condominium. At trial, Defendant filed a motion to dismiss the complaint. In the motion, Defendant acknowledged that she owed past-due assessments […]