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Foreclosed condo continues renting out, association gets no money

Posted on Sat, Oct 23, 2010 @ 08:01 AM
We have a situation where a owner is delinquent to the HOA and is in foreclosure but continues to rent out, collect rents and deposits before the new tenant takes up residence thus avoiding  paying their fees to the HOA. When this unit comes empty again would we be within our rights to cut of the water supply? This supply is included in the Condo fee's and is not metered. If she is not paying then why should she be permitted to take services? It seems to me that the laws here in Florida encourage certain types of people to take advantage and there is little that you can do about it.

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Lokk for any pertinent words in your bylaws. If you find such then proceed in accord with those instructions. Further you should read your state's condominium act to determone the law in relation to forecolsures ect. NIn many states the law requires that at settlement the overdue condo fees are included in the final price and those fees then are paid to the association. You'll need the services of a lawyer to make sure this return of overdue fees actually takes place. It is not automation-the association has to get involved with the settlement procedure to protect your rights.You should not wait to take action upon the uniut becoming vacant.

posted @ Saturday, October 23, 2010 9:24 AM by Charles Adler

* You do not mention whether or not it's the condo association that is renting or not. 
** If the association initiated the foreclosure, then part of the process is to evict the tenant when it is actually foreclosed on; or do a new contract and have the unit pay the association the rent;  
***or sell the unit if you get it to recover all fees due;  
****and/or if the bank forecloses, then contact them for past dues ASAP. 
I would strongly advise our Board to NOT cut services to any tenant unless the Board owned the property.  
What you think seems right, is not always.

posted @ Saturday, October 23, 2010 10:01 AM by Sheri

No, in Florida you cannot cut the water supply. It appears to me this is a bank pre-foreclosure situation, which now with the moratorium could last even longer to actaully foreclose. Don't you have a collections attorney ?? What is he/she waiting to foreclose before the banks do ?? Effective July 1, 2010 your condo association can demand assessments from tenants when landlords are past due for whatever reason. You need to have a discussion with a Florida experienced collections attorney.

posted @ Saturday, October 23, 2010 7:44 PM by Susana Murray

I live in a Fl condominium and am the advisory chair to 7,856 units and have 8 years at this. I am not an attorney. 
Cutting necessary utilities to a unit I do not believe is legal in any state. 
Small claims court (look at the $ limits of suit)may be the way to go, especially if you live in Florida like above commentor. In Fl, effective July 1st, 2010, Condo's were given the self help remedy of direct collection from a tenant. 
I would strongly suggest that if you do not have an ownership/rental approval process, put it in place immediately through Declaration and Bylaws or CC&R's. Witholding the right to rent is permissible in Fl. if contained in the Bylaws when a debt is due and owning to the association. 

posted @ Friday, November 05, 2010 1:43 AM by Randall

Be careful when dealing with tenants of delinquent homeowners. Discloseure of a debt to a third party violates the Fair Debt Collection Practices Act, which is a Federal Law.  
Warning to Floridians: the new laws effective July 1 have not been "flushed" by the Courts and some of the language is unclear. Always consult with an attorney. As far as small claims court, you may get a judgment from the Judge against homeowner but this does not guarantee you will actually collect any cash unless you lien homeowner non-exempt assets. It is complicated.

posted @ Friday, November 05, 2010 7:27 AM by Susana

Read the new law : You can collect  
the rent and applied to what is due. Once the balance is zero return to owner.You have to wait for the owner to rent the property the association can not rent Or you can lien and get a certificate of title an legally rent the unit. 

posted @ Monday, February 07, 2011 7:08 PM by teresa

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