Tenant Question

Started by PatJ • 8 replies • 1919 views

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PatJ (South Carolina)
Posts: 2

Posted:

Let me get this straight, The HOA has no authority over a renter, and the renter does not have to abide by any rules unless the owner asks them to.

The unit owner, who is in default with the HOA for nonpayment of 1-1/2 yrs of fees & in foreclosure (yet continues to receive rent from his tenant), is the person the board must work with to get his tenant to comply. Do you think he'll go out of his way to make our community a better place, or will he do whatever it takes to continue his rental income. He is out no more or no less if the fees are imposed.

The lien has been in place for over a year with no avail. I, as a homeowner, have a vested interest in the property, whereas who he brings in actually bring down our property values.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Pat

Overall the HOA does not have control over the renter, only over the owner. Now there might be several ways to skin a cat.

1. Inform the renter that back dues have not been paid so the association has placed liens on the property and is "considering" foreclosure on the owner. Such foreclosure on the owner "could" mean eviction of anyone living there. A scare tactic but if worded properly, informational only, not a threat. Use words like could, might, considering, etc.

2. Amenities associated with the unit are in the owners name and can be stopped if dues are owed. An example is a pool pass which in the owners name who the owner gave to the renter. You are stopping the pool pass based on the owners name, not the renters name. Cable TV, water, parking permits, etc.

Hope this helps.

SheliaH (Indiana)
Posts: 6,964

Posted:

At first, I thought you were in our community, but you're in South Carolina.

Unfortunately, this type of thing happens everywhere, HOA or not - we've been going back and forth with an out of state owner, have a lien and authorized our attorney to proceed with foreclosure (in fact the guy has done this with several homes around town, some in HOAs, some not. Don't know why he's allergic to paying his damned bills).

However, you've probably seen other posts on foreclosures around this site and in most cases, the best you can hope for is to get rid of the owner so someone else can buy the property and start paying fees. The tenant probably doesn't care a whit if he has to move.

In our state, the HOA can go to court and ask that the rent be garnished, so you may want to ask your attorney if that might be an option. The tenant would have to pay rent to the court and the money goes to the Association to apply against the delinquent balance. It's not a guarantee of anything - in Indiana, a notice is sent to the tenant, asking him/her to sign off on the garnish - and if they don't sign, you have no choice but to proceed with the foreclosure because the rental agreement is with the owner, not the association. Or the tenant may simply leave

As for the rules, the owner is ultimately responsible for his/her tenant's behavior, so if there have been any violations of your CCRs or other community rules, you should take the same action as if the owner lived in the unit.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

CarolR11 (Colorado)
Posts: 2,563

Posted:

Suspending amenities might work if SC law and your documents permit it. Not all states permit suspending water, for example, but pool passes and parking permits (if the spaces aren't deed to the owner) suspension can help a lot.

MatthewW4 (Arizona)
Posts: 500

Posted:

Quote:

Posted By PatJ on 06/14/2013 2:47 PM
Let me get this straight, The HOA has no authority over a renter, and the renter does not have to abide by any rules unless the owner asks them to.

The unit owner, who is in default with the HOA for nonpayment of 1-1/2 yrs of fees & in foreclosure (yet continues to receive rent from his tenant), is the person the board must work with to get his tenant to comply. Do you think he'll go out of his way to make our community a better place, or will he do whatever it takes to continue his rental income. He is out no more or no less if the fees are imposed.

The lien has been in place for over a year with no avail. I, as a homeowner, have a vested interest in the property, whereas who he brings in actually bring down our property values.

Pat,

You are operating on a bunch of assumptions that have little support in law. When a person rents a property, he becomes the temporary owner and has the same responsibilities and duties as the owner and is subject to the same restrictions as the owner.

The declaration for your development should be a recorded document and, therefore, notice has been given to the tenant as well as to all other members of the public. The tenant cannot plead ignorance of the provisions set forth in the declaration. Since your association has the power to enforce those provisions, you have the same authority over every person who occupies the property whether they are owner, landlord, or tenant.

The tenant is in possession of the property and your association is providing services to the property. The declaration also gives notice to all that there is a fee for the services provided by the association. Again, the tenant cannot plead ignorance of this due to the recording of the declaration.

The tenant may not be aware that his landlord is not paying for the services that your association is providing. As a first step, I would recommend informing the tenant that his landlord has not paid his assessments for the past 18 months and inform him of the balance due. I would then demand that the tenant deduct the amount owed to the association from the rent paid to the landlord until the assessment is brought current. I would also inform the tenant that if he does not wish to pay the past-due assessments that you will file a civil suit against the landlord and tenant jointly to recover the assessments.

MatthewW4 (Arizona)
Posts: 500

Posted:

Quote:

Posted By MatthewW4 on 06/14/2013 4:34 PM

I would then demand that the tenant deduct the amount owed to the association from the rent paid to the landlord until the assessment is brought current.

My own advice is not quite right.

You do not know what arrangement the landlord and tenant made regarding assessments. Therefore, suggesting that the tenant pay the assessments as an offset to his rent is wrong. Let the tenant and landlord work out who pays how much. Just give notice to the tenant that he is jointly responsible with the landlord for the payment of assessments as he is the party in possession of the property.

AnnH4 (Florida)
Posts: 53

Posted:

I suppose it depends on the statutes for each state. In Florida, Associations have a few options. The first option is to do a "rent demand" on the tenant via the Association attorney. This means that the Association can collect rent for the unpaid assessments.

The second option is for the Association to foreclose on the lien for unpaid assessments. This would force a non-compliant tenant out, make the Association whole as far as the unpaid assessments and attorney's fees. If the Association already had made a move to foreclose on the lien, it could be a fast way to get the tenant out. There is a downside to this. For one, if the home was sold as a Certificate of Title (aka dirty deed), you could very well end up with tenants again. If nobody bids on the Certificate of Title at auction, your Association could be taking title.

Lastly, if the owner has filed for bankruptcy, that might change what the Association can and can't do as far as debt collection. I understand your frustration as a homeowner though. But never assume that your Association isn't already trying to do something or enforce something to make the situation better. Sometimes there are mitigating circumstances behind the scenes.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

This is a complicated issue. There are also laws regarding "Tenants rights" that factor in many cases. Meaning a landlord can't even evict their own tenant for a period of time. A renter could in some states stop paying rent for upwards toward a year without eviction. So neither the HOA nor landlord can evict the tenant. In our state it takes 2 10 working day notifications for an eviction. Holidays are disgarded and that doesn't count the 2 weeks for a sheriff's eviction if they don't move in that time period. A bare minimum is about 30 days for an eviction.

The contract is between the tenant and the owner. NOT the HOA. However, the owner does have a contract with the HOA to obey the rules. That is why owner's feet are held to the ground not the tenants by the HOA. Many landlords overlook the fact they should have the HOA conditions written into their rental agreement so they can evict tenants who violate the HOA rules. Off the shelf agreements don't include these conditions so that is why it hurts the landlord by not having a legal means of evicting.

Florida has a law that the tenant can pay the dues of the owner to avoid foreclosure. Later that tenant can sue the owner to get that money back I am sure. However, most states this isn't the case. The tenant can't pay the dues on the behalf of the owner. Considering that dues payment would be tax deductible to the owner when it's rental, why they don't pay is beyond me. The HOA can still lien and foreclose on that property.

I used to rent my HOA property and have foreclosed on a property with a rent to own situation. They tried to make the tenant pay their back dues. The tenant moved out and then sued them later. The owner lost the house. My renter did not pay rent for a few months and took me 5 months to evict. Had to put the house up for sale to give them the final hint. So I understand the situation pretty well.

All you can hope for is a lien is put on the property. If the bank isn't foreclosing, then your HOA can consider it. However, I would only do that if it's worth stopping the bleeding. It's not a money maker.

Former HOA President

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

The law is on your side. Your HOA has the legal right to foreclose on the unit and remove the tenant. The fact that you have chosen not to take this route is your fault. No one else is to blame.

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