Condo Association Management Blog

At least in Massachusetts, special assessments do not have priority over the first mortgage so if the lender forecloses on units, assoication lien might be wiped out. That being said, you need the monies for the reparis and therefore probably should be aggressive in pursuing lien enforcement actions against delinquent unit owners and the amounts are a lien against the unit owner's unit and a personal liability of hte unit owner. 
 
 
 
Stephen Marcus 
 
Marcus Errico Emmer & Brooks PC 
 
Braintree, Massachusetts 
 
781.843.5000 
 
smarcus@meeb.com 
 
www.meeb.com

We needed a condo association loan for our capital projects. Our delinquency rate was too high, so we had to work with our property management co to get our delinquencies under 5% before we could qualify.

In California, if the HOA has a lien and is pursuing foreclosure and the first mortgage holder forecloses, it generally does wipe out the association's lien (however, note that the lender's interest and recorded docs would have to be reviewed to confirm). HOAs in this state have found some success in things like (1) more assertive collections policies and practices (staying on top of the collections earlier rather than later), (2) pursuing owners without equity in the home, but with jobs, and assets, through personal debt actions including small claims, (3) choosing judicial foreclosure over nonjudicial, (4) and offering more payment plans to help people catch up. Many are budgeting for losses, and also assessing losses and writing some debt off to resolve the issue of the percentage of outstanding delinquencies. It sounds like you could use some professional help to "reposition" efforts.

What most associations/management companies do not know is they are alternatives to collecting their delinquent accounts. Our company, NCS Plus has collection program specifically for associations and their management companies.  
We are a low fixed fee nationwide agency that has a specific program for HOAs and COAs collections. We help associations collection delinquent assessments; however our program is designed for management companies specifically because it allows you the manage the delinquent accounts collections for all your associations in one place. We don't replace the attorney's role in the legal process, just the high costs of using them for collections. Our associations are averaging a 25% recovery rate within the first 45 days and in many cases up to a 68% reduction in collection costs. We have clients nationwide, our management clients are companies that manage between 5-500 associations and usually between 500-75,000 units under management, so we can help any company.  
We have successfully collected delinquent accounts from homeowners and banks that have foreclosed on homes.  
 
If you wish click this direct link to our association page http://www.goodnewsonbadaccounts.com/NCS_PLus/Associations.html 
 
Our program is getting results and can be an additional revenue stream for a management company if they choose.  
 
Todd French 
National Account Executive  
NCS Plus Inc. 
Toll Free 1-800-363-7215 ext 4258 
www.goodnewsonbadaccounts.com 
 
We take your money seriously and get it back for you- we guarantee it.

Our recovery rate looks to be a little higher than some of our competitors in the collections arena. We are a little over 50%. I think the reason for it is that we are aggressive yet sensitive to the fact that they are your neighbors and your kids play together. 
 
 
 
We started using Small Claims court to pursue wage garnishments against the individual homeowners because they didn't have any equity in their homes. This proved a highly effective slap upside the head to most of them and we got calls requesting payment plans after they were served. 
 
 
 
It comes down to being serious about it and using all of the power under the law. Most associations don't utilize their authority because using attorneys is expensive. That's where your collection agencies fill the gap between the manager and the attorney. 
 
 
 
Darron Hay 
 
HOA Receivables Management