HOA officer home in foreclosure

I have a question concerning confict of interest. I was recently elected as board member to a small HOA in Florida (17 townhouses). The vice president of the HOA is involved in a foreclosure to obtain HAMP refinancing. He is not delinquent on any dues. The HOA was named as defendant in the lawsuit as standard procedure apparantly. The HOA has not officially disclosed this lawsuit to the HOA members. My question is this-is the board meeting it's fidicuary responsibility by keeping this lawsuit secret from the members even though they are all actually party to the lawsuit. Would it not be prudent to inform the members of the details and progress of the suit since it could impact them. Thanks-

Roger

Roger,
I am in Texas and things here are a bit different than in other States, but my first reaction to this is that a foreclosure is not a lawsuit against the HOA. The member / board member is in good standing as he is not delinquent. (count your blessings). I googled HAMP refinancing and from the few items I read, this is only for folks who are current on thier payments but owe more than the property is worth. This person seems to be trying to use a means that has been provided to him to correct that and then will only owe what the property is worth if the refinancing is approved. It also didn't say that this type of refinancing is considered part of foreclosure.
In my opinion there is NO conflict.
Since I do not believe it is proper to use the term lawsuit regarding foreclosure, it didn't appear that HAMP refinancing is part of a foreclosure, and the member is current with the HOA, disclosure of a members personal information that you happen to be aware of would be improper.
This is just my opinion.
Lynette

Foreclosures are tricky areas. People don't realize that IF a HOA was doing the foreclosing that the BANK gets paid FIRST before the HOA. So IF the owner owes money to bank then that debt is paid off first and the left over is given to the HOA for whatever money it is owed. The bank and HOA go hand in hand but the bank has the upper one at ALL times. Basically, a HOA is doing the dirty work for the bank at a HIGH risk of little return in some cases.

In this case, the bank is doing the foreclosing. This means the HOA is still involved because the bank would be on the hook for paying the HOA any dues owed if there was a lien on the property. That is because the property becomes the banks and whoever owns the property owes the dues. Being that the owner does NOT owe the HOA anything then it takes the role of any other debt collector. Other debt collectors can be credit cards, utilities, and a list of other companies your indebted to pay off.

This can fall under "Collections" which can be handled just with board members as collection portions of the budget are typically handled PRIVATELY amongst the board and DEBTS/Payouts are PUBLIC domain. However, this information may be necessary to have on the HUD paperwork that is sent out asking the conditions of the HOA on occassion.

I would keep this amongst the board for now until the process is finished or an issue arrives. It sounds like the HOA isn't losing money unless they are paying a lawyer for some unknown reason...

I was under the impression that HAMP and the lawsuit were two different issues. Is the Vice President telling you the whole story? Doesn't sound legit.

I think you guys are missing the point.

When someone in your HOA has a lein, forclosure, judgement or anything else placed against the house your HOA is the defendant. BECAUSE that home is part of the HOA.

No need to let the other HO know about this...They can find it themselves by looking at the county records. Also, when you have someone looking to buy a house in your community they can also look at county records, smart buyers do. I did!!!

If you don't beleive me... Google "XXXX county records" then type in your community name. BAM... You will find out anything you ever what to know about everyone in your neighborhood, ie how much they paid for there house, any leins, any judgements. Plus you should find your Bylaws and CCR's if it was done correctly.

The forclosure is not against the HOA, per say, because he is/was a member of the BOD. Its becuase the HOUSE is in your HOA.

Janet,

As with any security deed, an HAMP refinance will be recorded with the court and made part of the public record.

If the board decides to keep information like this to themselves, it is a decision based on accommodating the sensibilities of the homeowner and not because of any statute regarding privacy.

In my experience, it is usually better to keep the members of the association informed as to anything that is going on, with very few exceptions such as personnel issues or ongoing contract negotiations.