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Homeowners Associations - Maintenance Fees and Foreclosures

Posted on Thu, Feb 26, 2009 @ 07:35 AM
  
  
  
  

ST. LUCIE COUNTY - Homeowners association leaders are growing weary of having to cover the maintenance fees and other costs of foreclosed units, a new survey has found.

The survey, conducted by the Community Association Leadership Lobby - a group formed in 2003 by the Fort Lauderdale law firm Becker & Poliakoff to advocate on behalf of homeowners associations, condominiums and other community associations in Florida - found that nearly two-thirds of respondents said foreclosures are "causing a revenue shortfall that is placing a burden on the associations' finances."

As a result, 38 percent said, the foreclosure-related revenue crunch for Florida condo and homeowners associations has resulted in "postponements of major capital investments in upkeep or repair" of buildings and other property.

Almost 1,600 property owners responded to the second annual survey, conducted online from Jan. 15 through Feb. 1. Three-fourths of respondents were elected members of their community association's board of directors.

Mortgage lenders holding title to foreclosed units are to blame, the respondents said, with more than 90 percent of them agreeing the Legislature should decrease the financial burden on the associations by increasing the liability of mortgage holders for unpaid assessments.

Maurice Lapine, association president for the 102-unit Atlantic View Beach Club on North Hutchinson Island, wants banks to be required to start paying fees on a property as soon as foreclosure papers are filed, rather than being able to wait until the bank takes title.

"We feel the banks are getting away with murder here," said Lapine, who is also property manager for the 1,578-unit Nettles Island Condo Association. "Why should we be asked to carry the banks' load in these foreclosures?"

Anthony DiMarco, executive vice president of government affairs for the Florida Bankers Association, said, "I understand their concerns but we're kind of caught in the middle. We don't want to foreclose on anybody; we want to work out these loans.

"The government has made it clear they want less foreclosures ... and these people want us to foreclose faster," DiMarco said.

Karen Merrill is owner of Vero Beach-based Elliott Merrill Community Management, which works with 85 communities in Indian River and St. Lucie counties.

Communities that were built in the past four years or so have more problems than older communities, Merrill said, because newer properties attracted more investor owners instead of resident owners. And condo associations have to absorb more costs than homeowner associations because maintenance fees are generally higher, in part because of property insurance premiums, Merrill said.

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