collection of assessment

Started by SteveH15 • 8 replies • 801 views

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SteveH15 (California)
Posts: 28

Posted:

we all know that if one unit owner did not pay its due on HOA fee (or special assessment), the management company can put lien or flag of not pay in full on the unit. and if the owner sell the unit, it will be caught or flaged when they trasfer the title (when selling).

However, if the owner is an investor or developer, it is the company (developer, or investor) own the unit, or units (more than one unit). Lets call the company name is ABC. ABC did not pay or own fee on unit number 1, but paid in full of unit #2. when they sell the unit nbr 2, - since its owner is company ABC, can we request the ABC must pay the due in full (good standing of all the units) before the sell transaction can go through?

anyone have experience on this, please share and advise.

thanks

TimB4 (Tennessee)
Posts: 21,059

Posted:

If you take the issue through the courts and receive a judgement, you can then go through the process of collecting the judgement utilizing any asset the company (debtor) owns.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Is this company a "LLC"? (Limited Liability Corporation). That can play a factor in collecting. It usually means more than one person is involved. Which can make it a bit tricky when you go to collect/enforce liens. I refer to "LLC's" as "Who wants to go to jail for the rest of us?" corporation. The corporate owner who draws the smallest straw is usually the one left with the burden.

I had to deal with one a few years ago. They had properties in other areas being lien on as well. That is when I found out that they can "pass the buck" along causing some confusion who your filing against. There are some built in protections by forming a LLC for some investor types.

So do a bit of homework on the company before proceeding. You may find if they are in deep-do-do, it may not be worth throwing good money after bad.

Former HOA President

BenA2 (Texas)
Posts: 1,273

Posted:

If you place a lien on the property it does not matter who or what owns it because the lien is attached to the property, not a person. If a buyer purchases it from ABC company and does not go through a title company then the past assessments may not be collected but the lien would remain. The buyer would be responsible for the past assessments and, if he did not pay them, it could be collected when he tries to sell it.

I don't think you could stop ABC from selling under any circumstance.

Our assessments are very low and consequently, it is not worth the legal fees trying to collect past due accounts. We place a lien and just wait. Eventually, the buyer will sell and we collect. This does not necessarily happen if they do not go through a title company but the lien still remains. The cost of placing a lien is added to the owed amount.

In Texas, even if they file for bankruptcy or the property is foreclosed by the county for taxes, the lien remains.

TrishB (North Carolina)
Posts: 1

Posted:

Question, I will try to be brief. Our HOA, with the approval of residents hired a contractor to repair a portion of our parking lot and sidewalk. Residents was aware of a future "Special Assessment" for the work done. The repair was needed because the parking lot was uneven and held big puddles of water. So work is done, the B.O.D. are satisfied with the work, however; the problem was not solved it just moved water being held from one spot to another. Also our curbs are uneven where they repaired and replaced sidewalk. This Company also made BIG cracks in our parking lot. My fear is because of the uneven pavements someone can trip and fall; then the association gets sued.
My question is can a homeowner refuse to pay the assessment, if they feel the company hired should come back and do the work properly?

GenoS (Florida)
Posts: 4,276

Posted:

Hi, TrishB. Best to start another thread for your questions. This one is about assessments and liens.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Quote:

Posted By TrishB on 01/27/2018 8:08 AM

My question is can a homeowner refuse to pay the assessment, if they feel the company hired should come back and do the work properly?

Being in an HOA is not the same as a landlord/tenant arrangement.

Not paying the HOA because you are unhappy with the work of the Board would be like not paying your property taxes because you are unhappy with the government.

Can you choose not to pay assessments? Yes. However, just like not paying your property taxes, there will be consequences up to and including the possible loss of your home.

Instead, you need to inform the Association of these issues in writing.
Be polite.
Point out that you are afraid of potential liability to the Association if someone is hurt because of these issues and you expect that the Board to minimize any potential liability risk.

If the Board doesn't respond the way you think they should, gather support and replace them with individuals who will address the issues.

BenA2 (Texas)
Posts: 1,273

Posted:

Quote:

Posted By TrishB on 01/27/2018 8:08 AM
Question, I will try to be brief. Our HOA, with the approval of residents hired a contractor to repair a portion of our parking lot and sidewalk. Residents was aware of a future "Special Assessment" for the work done. The repair was needed because the parking lot was uneven and held big puddles of water. So work is done, the B.O.D. are satisfied with the work, however; the problem was not solved it just moved water being held from one spot to another. Also our curbs are uneven where they repaired and replaced sidewalk. This Company also made BIG cracks in our parking lot. My fear is because of the uneven pavements someone can trip and fall; then the association gets sued.
My question is can a homeowner refuse to pay the assessment, if they feel the company hired should come back and do the work properly?

You have a legitimate concern but you would still be obligated to pay the special assessment, assuming your HOA has authority in your CC&Rs to impose a special assessment and went through the proper process.

It may be that your BOD did not do a good job in making sure the contractor did quality work but the only valid reason, I can think of, for not paying a special assessment would be that the special assessment was was not properly imposed. In that case, I wouldn't pay it but I would also go to court to get a judge to rule on it.

SteveH15 (California)
Posts: 28

Posted:

to trishB:, I agreed with Viginia, this case is just like your initial asessement for 100 dollar- for example, for whatever the reason, the contractor at finish to satisfy the job, require more money that was not expected at the beginning, therefore need addtional money. HOA member has no choose but pay the "insufficient assessment".

The lesson learned from this process is that BOD and the member have to have a mutually understand that the asssessment for any project of HOA can not allow "negative". have to have enough to pay for all the expenses (of course under control), plus leave some room for reserve. - this seems on every CC&R I have seen.

this is the justification and foundation that our HOA BOD go by to collect the "insufficient assessement" for the past as long as the acconting records can support. thank you for everyone's input so far.

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