Proof of Bankruptcy

I'm the treasurer of our small HOA. We have a homeowner who was delinquent for this years dues and the two prior years. After several late notices, he finally paid this years dues but claims he doesn't owe the two prior years because he filed for bankruptcy. My question: Should the HOA have been notified of this bankruptcy? Should he be responsible for providing documentation to the HOA showing this filing? What recourse, if any, do we have to collect? Do I understand correctly that if he did officially file for bankruptcy, his two years of unpaid dues would be wiped out? Any one crossed this bridge before? Advice would be appreciated. If I can't get some guidance from this forum, I'll have to ask our HOA attorney and pay for his advice. Thanks.

Mike

Tim,

I've been involved throughout the time frame of his supposed bankruptcy and we have never been notified. If his HOA debts weren't listed in his, if true, bankruptcy, would he still be liable for the back dues. I'm not sure what steps are needed to verify all of this as I'm not an attorney and I've never been involved in any type of bankruptcy issue before. Is this a public record that could be looked at at the courthouse? If so, what would I look for?

Mike

Thanks again Tim for your input.

I think that was pretty much my question all along. Shouldn't it be his responsibility to produce the documentation in order to have the debt cleared, not the HOA's responsibility? Again, the HOA was never contacted about this bankruptcy. If it is his responsibility, and he doesn't present documentation, I should just keep following our debt collection procedure until he does. I'm of the opinion the burden should be on him or it didn't happen. Worst case scenario that I can see is that we end up filling a lien on his property, and he has to produce the documentation at that time to remove it. Any thoughts?

Mike

3 years ehh? Who dropped the ball?

file the lien after 90 days

forclose after 180 days

trust me, you will only have to do this ONCE

when someone sees a home gone for unpaid dues there will be a STAMPEDE to pay up

I think you got it nailed. The burden is on this owner to show that his debt was discharged through bankruptcy. All it should take for him to produce that proof is to make a phone call to his bankruptcy attorney if one exists. Right now this claim falls into the category of "My dog ate my homework."

JohnC is right. Bankruptcy does NOT absolve one from paying HOA dues or back dues. It's not part of the bankruptcy. They still owe the money during that time. Have records of those unpaid dues and give notice of intent to lien in 30 days. We have an established policy of 6 months behind in dues we liened. 1 year owed dues we start foreclosure CONSIDERATIONS.

Bankruptcy filings work in a strange way. HOA dues owed fall through a "Hole" in the system. It is rather quite complicated to explain. However, there are some debts like HOA dues that don't end up in bankruptcy forgiveness. There are factors involved like having a lien filed at the time that may factor in.

I would talk to a bankruptcy lawyer for some information. May be the best source to sort through the craziness of bankruptcy laws.

Stop taking what I state as playing attorney. I was agreeing with John's perspective that the money owed during that time is NOT part of the bankruptcy. They never contacte the HOA nor was it most likely listed as a debt to the bankruptcy court. A lien on file at the time may have showed up. However, the HOA did not report the debt out there either to be found.

Keep in mind HOA's do NOT collect social security numbers of members. They file liens against the property address. The owner on record owes the dues. So debts on property may not be part of the bankruptcy as it does not always go to one's credit report. Credit reports being where most debts are reported to the court. Hence why I mention the "hole" rhe HOA dues fall into.

Yeah if YOU report it. HOA dues are a "funny" thing. Yes, they are owed. No doubt. However, have you considered how people can claim ignorance on HOA dues owed? Saying they did not know they bought into a HOA? They should be something a mortgage company factors into your debt load at loan approval. FHA type loans do indeed makes the HOA report on a PUD form. Can not deny it then.

However, those who buy through different loan packages, straight cash, or volunteer only HOA's HOA fees are not reported as readily. You can NOT ASSUME those dues are reported to any official outlets. Except for the HOA paperwork, it is basically a contract between HOA and owner similar to a private contract.

It is very complicated. Just know that there are loopholes when it comes to bankruptcy and reporting HOA dues being owed. The HOA should always have a policy and file liens. Liens are the best recording device for money owed a HOA. In this case the HOA also dropped the ball. It is just they did not know the ball was in their hands.