Forclosure Legal Fees

Quite frankly your HOA is wasting money on this completely. It's NOT worth the effort for this attorney notice and paying this bill. First reason: a foreclosure is PUBLIC information. Meaning it's free to know if you put a little effort into it. No need for an attorney. It has to be published in the local newspaper under the "Legal" section of the classifieds. Each paper is different so will it's schedule on publishing legal notifications. So it will be up to you all to take a gander at the newspaper and get to know that information for your area.

Second. What does the HOA care if the home is in foreclosure if the owner is up to date in their assessments? The HOA should care when the owner is behind in dues. That is the point the HOA can lien before the bank forecloses. If the HOA forecloses for back dues, it does the work of the bank essentiallly. So the HOA may NOT want to do a foreclosure if the bank is going to do one. The bank gets paid first regardless if the HOA does the foreclosure or not. A few states do have something called a "Super lien" that could put the HOA on the same level as the bank when coming to collecting debt. However, it's pretty much useless as there is not enough money available to pay any of the debts owed either party.

Sounds like you have a HOA too dependant on it's legal council. Time to get a bit more educated instead of constantly going through your lawyer for everything. There are many things your HOA can do without constantly using a lawyer to do. Read your CC&R's and get an understanding of them. No need for a lawyer to constantly draft up notices. It's a waste of HOA money. It's also a sign of living in fear of a sue happy world. My suggestion: Stop worrying about being sued. Your going to be or atleast threatened to be. It is cheaper to counter sue than to bring a lawsuit. If anyone threatens to sue, tell them to go ahead and make the effort. Wait for the paperwork. If your HOA is acting correctly and within it's own rules, then any lawsuit will be tossed out. Suing your HOA is suing yourself and your neighbors. A concept your HOA may want to pass around...

Its not a cost of any hoa i know of. Its an unnecessary service your lawyer is billing you for. And no, you cant bill the homeowner for it.

Thank you for the information. One of our past board members was very much so into the legal in's & out's and also had our budget through the roof with attorney bills for mostly useless stuff. Sounds like this is another one I can stop.

I'm not sure why or who notifies our attorney. I try to stay out of the legal area but I was asked if we could bill the homeowner for this by another board member. I'm going to say we should stop this practice.

A HOA technically only needs an attorney to represent them in court if necessary. That is the MINIMUM need for an attorney. Just so you understand the very basic need of an attorney to put things in perspective. That way you will be able to determine if your lawyer is being honest with you. If they tell you a bunch of other stuff that should ring some bells or atleast raise questions.

Now some states do require an attorney to file a lien. You may want to call your local courthouse to verify this. Most likely probate court if you need a department. Foreclosures are done in court so that will require the attorney.

Small claims lawsuits should be avoided by a HOA. Liens are a better option to pursue. It is also cheaper to be counter sued than to bring a lawsuit. I bring this up so your HOa does not fall down that rabbit hole as well. Not saying they aren't needed but not the best option to pursue.

Hope this helps to put lawyer needs in perspective. Some HOA's do over use the attorney for everything. It can cripple them. So try to back away from that dependency and save some costs.

Mike,

Check your state laws and see what the requirements are for a registered agent. Many people confuse the registered agent or statutory agent with the corporation's attorney. In my state, a statutory agent is not required to be an attorney nor is he required to be a board member, an officer, nor even a member of the association.

The statutory agent is basically a human "inbox." His purpose is to receive legal notices for the corporation.

If notices are being served on the corporation through its registered agent, he should be forwarding those notices to the board or other designated persons. There is no reason for him send you a letter informing you that he received notice that your association has filed a lien, which you should already know, and no excuse for him to generate a bill to write a letter informing you of something you already should know.

BTW, you indicated that there is some confusion as to how these liens are being created and who is filing them. Since these liens are being filed in the name of the association, there is no excuse for someone to file them without the board's knowledge and consent.