Condo Association Management Blog

Foreclosure is a court process. Filing times vary depending on your area, but typically foreclosure takes from 6 months to a year.

Good Morning Faith: 
 
Joe is correct, sometimes the foreclosure (f/c) process can take a long time depending on which route you take and the state laws. In WA for example, the f/c can be done judicially and possibly take the house from the bank and homeowner. However, the time required to do it can be up to year if you need to serve your notices by publication. In WA, when you start a judicial f/c, you first serve everyone with your summons and complaint and then wait for them to respond. If you don't know where they are, you have to find them or publish. It's possible that the attorney is working on issues like these and there's simply nothing of significance to report. 
 
Now, I will say that in general, we succeed in collecting where attorneys are not as successful. We routinely take files from attorney's offices and recover assessments which they were unable to. It's been our experince in the last two years that about 2/3 of the people do not pay because they refuse; not because they cannot afford it. It's a choice. 
 
So, we help motivate them to make the payments. They go in our call rotation and we call them up to the maximum allowed by the law. This is specially useful when we have means to recover unpublished and unlisted phone numbers. When we start calling personnal cell phones, it's amazing the responses (and money) we get. 
 
Darron 
 
Assessment Recovery

After reading some articles I have seen that even if you go for a forclosure you will never get back from the owner or the bank/mortgage company what these owners owe you. I understand only 12 months of the arrears or 10% will only pay you the association back. If you go for a lien I am wondering if it is the same. I would think not since if they sell It will come off th top or you as the association BOD will not and should not give them a certificate of resale. Then WHY dosen't this apply to a forclosure? HUM! 
 
Either way you are stuck in the mud hole for all this will take time even with a Lawyer. The state laws need to change this and if a person is 6 months behind and no other re-course has been taken to pay up, then why can't the banks work with us and give us everything that is owed us when the unit goes into forclosure. Also if it goes into forclosure I believe you have the opportunity to buy it back at the sale price and then rent it out. After 3 months of getting behind (that's a rentee) I am talking about, you the BOD can evict them. But gee wiz that even takes a year to do. I AGAIN will state I will never ever buy into an association ever again. I will hire a nanny in my old age to take care of me. She will be easier to get rid of! LOL BUT "I am still smiling" This advice I just gave is stuff I gett off the internet. But you may want to ak your lawyer for the actual facts. Have a great day and good luck. Might I add that our association is getting snowballed for 3 people and 17,000 dollars they owe us. But I am not bitter...............

S: 
 
You are partially correct. The laws differ in every state. In some states, there are up to four categories of community associations. In some states there is one. In some states the condo lien has priority over the bank. In some states it does not. In some states the amount the association can recovery post f/c is 6 months while in others it is 12. 
 
You have to be careful about what you read online and know what the specific laws are in your state. 
 
Darron 
 
Assessment Recovery

Dear Darron 
 
 
 
It dosen't matter what state you live in. I have been reading testimonials from alot of different states with the same rules and regs. and people from all over in condo assoc and HOA are all having trouble with people being behind. Again I will state that the laws need to change and in order to do this we need 100% of the members to be at the meetings and be involved or it will never make a difference. I live in an association in Pa. and we only have 5 people out of 15 that care about their properties. 5 others that collect rent from rentees, and 3 that was BOD and won't give their in put anymore because they were forced to resign after letting our association go $17,000 in debt from deadbeat payers. And the reason I call them deadbeats is the 3 that are behind their units are paid off, and the assocition fees are very low to begin with. They just don't blatin give a crap! Liens were placed on their units and it will probably take the rest of their lives till their units ever get sold to pay us back. I am sad that people just let other people holding the bag and it ruins it for the upstanding person that really does care. Thanks anyway for thinking our rules really matter, to me they don't and if you don't abide by the rules and the state laws you really have nothing to hold onto. Thanks again

Dear S: 
 
We will have to agree to disagree. I believe it matters very much what state a particular association is in as it is that state's laws which will apply to the recourse the association has. In some states, WA for example, the associatoin has a lot of authority to recover money. In others, they are toothless tigers. 
 
I will agree that the laws need to be strengthened so that the associations have more authority to collect. 
 
For those special folks in the association who simply ignore and don't care, well, those are the one we specialize in. I have fun with some of them. :) 
 
Very Respectfully, 
 
Darron 
 
Assessment Recovery.

Here is what we do in SC with only 15 units: If a unit owner gets behind 3 months(we have sent them letters each month that they are late). We do one final letter from the President of the HOA - give them 5 days to get with the treasurer and make some arrangements to pay current. On the 6th day that they have made no arrangements, our attorney files in small claims court for the three months, attorney, court fees and any fees due this legal action. We do not let it go any longer than this. Once someone gets behind more than this it is too hard for them to pay. In small claims court you take file for up to $7500 here. You can also file there if they are required to take care of their own units exterior as long as letters have been sent properly - again for up to 7500.

Here is what we do in 24 unit condo in MA. One owner hasn't paid in 8 years. Every time she is 60 days behind our attorney serves her note of delinquency. BTW, all attorney fees will be paid by her or her bank eventually, but you might need to pay some upfront. The letter states that she has 30 days to dispute, otherwise it is considered acceptance. 30 days later attorney informs her bank with notice of default. Again, the fees will be paid by her bank eventually, but at this point we pay to law firm upfront and fees are logged to her "tab". Filing with bank is not only FHMA regulation, but also secures superior lien for association. So,then the bank pays.Everything - late fees, attorney fees and her condo dues(typically with one extra future month). 
I have no idea why bank wants to do it, but all we care that we get our money back. No clue why the bank wouldn't foreclose on her though... 8 years of this ordeal... My advise though, don't wait longer than 60 days. If the owner files BK and you have no lien, you won't be able to even send a note, as she/he will be protected by bankruptcy