Notifying Realtor about late dues?

Here is our situation...we are in the process of trying to clean up the mess of people that have dues that are way past due. We have sent out letters to those who are over a year past giving them 30 days to act before we file a lien.

I have also been keeping track of homes for sale in the neighborhood and one popped up last week that when I checked on their status they were nine months behind. They are also getting a 30 day notice letter. Here is my questions, some of our board members think we should also CC their realtor on it so they are aware that they owe this money and that a lien could be filed soon. I am not so sure that isn't violating confidential information, once a lien is filed then it is publice but until then I am not sure.

Any thoughts on whether this is an accepted practice?

BradP - if anything your HOA would notify the listing agent's broker. does your state practice the provision of a statement from the seller as to the condition of the property, awareness of any late fees, dues, special assessments on the common property, etc.? some states do this. you really should consult your attorney on disclosing the info to the listing agent's broker because your hoa may be accused of blowing the real estate deal.

Be careful, if you interfere in a home sale and it falls thru the HOA might be sued. Check with a lawyer. A lien may be public record but until it reaches that point it is still private.

Hi Brad:

A few cautions: 1) Be sure that you follow the legal requirements of your state and/or county in filing the lien, including any notice sent prior and the time period allowed. If there's a questions, check with the Association's lawyer. 2) In many states (including mine, Oregon) the Bank's mortgage takes first place among all liens on a property; if sold in foreclosure, the HOA only gets money if the sale exceeds what is owed to the Bank; and the bank just wants their money, so they may sell only for what is owed them. 3) In some states the assessment itself is a lien on the property for legal purposes, even if a formal lien isn't filed. 4) It's probably wise to inform the listing agent (who represents the owner in the sale of the property) of the amounts owed; they don't want to get into an ethics issue with their state real estate licensing bureau, so it's likely (if they are ethical) that they will make sure that the debt on the property is properly listed on the disclosure; but check with your association's lawyer before taking this step. It may be worthwhile to have the lawyer send the letter...

A side question that's probably relevant: how does your association collect assessments? Do you use a coupon book, or send assessment notices monthly? While I understand the concept behind coupon books, sending out statements of what's owed with a section to cut off and send in with payment does keep the owenr on notice of what is owed - so they don't get behind without realizing it. Many associations that are self-managed use a bookkeeping service or billing service or accountant to send out bills, or set up a contract with a management company to only handle finances; then, those services keep up on the accounts and send past-due notices, etc....if your board passes a "collection resolution" then the process is all set up so that people receive notice after being delinquent a certain amount of either time or money and then either set up a payment plan or get a lien filed.

J. Patrick Moore, CMCA

I've missed out on plenty of oportunities to lien on members that didn't pay up. Filing liens isn't that easy. It costs atleast $300 to place a lien here in my state. Each state varies. That money comes directly out of the HOA's budget. So if your going to threaten lien, the HOA had better be prepared to be out that money.
You will have to possibly treat each non-paying owner the same dispite the personal circumstances at first. Once a member calls, I'd recommend going on a case to case basis. I found offering the member the ability to "double" their dues payment each month helpful in preventing a lien. It allows them to "catch up without adding late fees and the HOA gets it's money without spending any. An excellent solution for most.
Remember, the HOA is NOT guaranteed to get the money owed until the house is sold. The owner can use the property as rental if they choose. It may take a LOOONG time to collect. In the meantime the HOA is out the lien filing costs. Most likely dues will continue NOT to come in. If that continues for another 6 months, then send out notices of foreclosure next.
Make sure the lien covers: Current/continous Dues, added up late fees, an interest rate either dictated by your documents/state law AND the cost of filing the lien. (may include attorney fees). The lien can't be placed just for late fees alone. It must be dues. The letter you send out should include all the costs the member will ensue if they keep on the course they are on. The word "lien" may have no meaning unless they truly know the meaning of what it truly costs.