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Is foreclosed condo buyer responsible for past due assessments?

Posted on Tue, May 03, 2011 @ 06:06 AM
  
  
  
When a buyer purchases a foreclosed property that has an association, is the buyer required to pay the the past due assessments?

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COMMENTS

Assuming the Association placed liens on the condo, then the new owner would not have purchased the unit with a cloud on the title. The unit owner, the lender, would have had to clear the title in order to sell it. Therefore based on MI and FL law, I would assume the new owner is NOT responsible for paying back dues.

posted @ Tuesday, May 03, 2011 6:29 AM by Arvid Martin


Somebody is. At the time of closing the escrow officer and realtors should be working out who pays for what and HOA assessments are settled at closing. This should be the case whether or not there is a lien.

posted @ Tuesday, May 03, 2011 10:07 AM by Leslie


In WA state the buyer is not responsible for past due assessments regardless of whether or not there was a foreclosure. Check your governing documents and state law.

posted @ Tuesday, May 03, 2011 11:11 AM by Lynn


It all depends upon what is stated in the assn's CCRs and also if there are any requirements stipulated in state law. Some states require the new owner to pay any delinquencies of the past owner, and some CCRs also state this.  
I agree with Leslie, that this should all be worked out at closing; however mistakes can be made by the assn and/or the title agent. Check your state law and CCRs and know exactly what you are resp. for before closing. You should get a statement before closing outlining what the closing costs will be. If there is a charge to you for delinquent assessments ask the title agent to show you the law that states you are responsible for paying them.

posted @ Tuesday, May 03, 2011 11:15 AM by mary


When a property goes to foreclosure, in most states the past assessments including any lien are dismissed. 
 
In a few states, VA being such a state, the lien runs with the land and HUD was paying the lien off.  
 
If a lien is filed and the association then goes for a judgement, that does not go away. It continues on their credit report until cleared - different from just a lien.  
 
However, the downside is the owner may file for bankruptcy and then past due assessments may be lost.  
 
Always best to seek counsel to ensure best protection for the association. 

posted @ Tuesday, May 03, 2011 11:38 AM by Nancy Jacobsen


Pass-due condo fees is a debt owed by the estate owner. The fee is not waived for owner's not living in the condo and management service had no effect on the absent owner.Check with lawyer.

posted @ Tuesday, May 03, 2011 1:07 PM by BETP Inc


We bought a foreclosed condo in MD so I can say that at least in MD, when a property is foreclosed, all junior liens including any that the condo association may have recorded are wiped out, zip zilch and nada. Hopefully they got a money judgement against the deadbeat "previous owner". This is why condo associations putting liens on properties is pointless in today's market.

posted @ Tuesday, May 03, 2011 4:08 PM by JIMMY


Buyer beware! In the state of Florida everything changes. Buying a condo at foreclosure sale means whatever the past owner owed the HOA and Condo Association is now the new owners expense. This also includes late fees, attorney fees and 18% interest. So if you think your getting a good deal at the foreclosure sale your not! I have researched this and cannot find in any law that late fees, attorney fees and interest can be charged. Of course you need an attorney and that cost money as well. Just a heads up for buyers in Florida. By the way the attorneys inflate the bill when a new owner steps in. How fair is this? The HOA said I purchased my home inept and should have known what to expect and they were going to foreclose on me if I didn't pay them all the money which was thousands of dollars. If you contact the association to find out if anything is owed before you buy the condo at foreclosure they cannot tell you it's privacy to the owner. I think this is a law that needs researched and changed immediately our more people that buy at foreclosure auction will be forced into foreclosure as well. If the bank takes possession of the home at auction only 1% of the mortgage has to be paid to the HOA and Association. Wake up people if you have a buyer your going to get more than what the bank was going to pay.

posted @ Sunday, March 11, 2012 10:38 AM by Jane


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