Refusal to pay assmt

"He does not recognize our HOA and is unhappy with the services provided"

Provided townhouse purchases are essentially the same as single family homes, at some point in the process of purchasing the home (usually the Title Company) someone recognizes that the home exists within a "owners' association". In fact, before the home can be sold, a TREC 37-2 form must be completed.

Therefore his claim "he doesn't recognize", is laughable and carries no weight, because he would have signed a form stating he does understand and that he is obligated to it.

As for being "unhappy with the services provided", sorry pal, the HOA is not there to provide a service. It's a requirement that those who are automatic members through purchasing a home that belongs to an "owners association" must bear. Like it or not.

Bottom line, if he fails to pay his dues, he is deliquent in his responsibilities and there are many actions that can be taken. Missing a payment happens, be polite and remind them. If they fail to pay after the reminder and miss another payment, you can decide how you want to pursue it:
1) Send more reminders until a set number. I suggest making a few of those certified mail and charging any cost incurred to the homeowner.
2) Send the account to a collection agency or attorney. In general, attorney's letters seem to work better, though compare results between attorneys. They will cost more, but that should also be charged to the homeowner.
3) As the attorney will likely recommend if the homeowner fails to comply - place a lien on their property.

You should have bylaws and CC&Rs that spell out your options, to include interest on amounts owed etc.
Be empowered, not matter how small of an HOA you have.

Take care,
Kevin H.

We are in cook county, Illinois.

TREC 37-2 is used in Texas and is completed by the PM or whoever is managing the HOA to confirm from their end, that the account is in good standing, etc. The seller pays to have this document completed. This helps the process move forward where the title company will verify if any additional liens exist on the property.

The form you seek, signed by the buyer, is part of the forms completed at the title company. Off-hand I am unsure which form that is for Texas, let alone Illinois. You may want to check with a title company to get the name of the form(s) buyers sign to acknowledge that their new home is part of an owner's association.

Each state will likely have a different form.

We have decided to hire an attorney and attempt to place a lien on the unit. Thanks for your input.

Kevin:

My advice if you guys have never encountered or had to deal with this before is to consult an attorney's advice on what is the best way to proceed in your county in your state. AS someone mentioned every state is different. We did that recently as we have several members who don't like to pay, the advice we got was to file a lien against the property which costs us $8 and is something we can do ourselves. I have heard of some associations using collection agents and some using attorneys to try and collect. I think your board needs to adopt a policy that will be used in all cases and proceed with that.

This person can not recognize the HOA all they want, but they bought and therefore belong. Before you do anything I would suggest giving them a last chance letter outlining the procedures you are going to take. They may call off their bluff and pay.

Kevin, Search this forum for: Illinois lien

One really good discussion with sample forms is here:
http://www.hoatalk.com/Forum/tabid/55/view/topic/forumid/1/postid/2944/Default.aspx

Best Regards,
HOATalk

That is a very good question. I would suggest sending the account to a collection agency for a fair price.

Thanks for your reply Kevin. We bought from the developer and so were aware of the existence of the HoA and Covenants. I called the local title company - there is no "form" in NM for a buyer to sign - however, according to the title company rep - there is a notice filed with the property at the court house - also there is a requirement as part of the disclosure law, that real estate agents make this disclosure. I'm not too sure how this applies to owner/sellers as we have one or two new owners (bought directly from the seller)who did not receive a copy of the covenants although they must have been aware of the existence of the HOA. Already these two have broken the covenants regarding pets. IT's a dilemma.

This is the procedure we use:
For the 1st 3months the account is delinquent we add a $35.00 late fee each month. After 3months the account is turned over to our collection attorney to file a lien. This attorney specializes in collections and ALL the fees and costs are added to the delinquent account and are what pays his fees. After six months if the account is not brought current or arrangements made, we start foreclosure procedures.

If it gets to the foreclosure stage the HOA usually ends up paying the attorney fees but is worth it to get the deadbeats out and someone who will (hopefully) pay their assessments.