Landscaping

RobB4 (Virginia)
Posts: 5

Posted:

Hello,

I’ve pretty much hit my breaking point with my condo association. I purchased my condo 12 years ago and have never been late on any of the payments. The landscaping situation out front and around the back part is in dire need of maintenance. An independent landscaper told me they have been stacking mulch for ages without removing the old stuff. A good amount of my paver tiles are completely buried. There are trees growing over the fence around back. I made so many attempts to get them to get someone to come out and make things right. They are playing games with me, and I am tired of it. Terrible considering the $334 I give them every month. I included links to pictures of the outside area to provide a better idea of what I am talking about.

I could really use some advise in terms of what steps I should take at this point. Can someone please confirm they are responsible? Any insight would be very much appreciated!

Cheers,

-Rob

https://photos.app.goo.gl/JiawzHrNh8eyD1xf9

https://photos.app.goo.gl/R51YtHMApDve3xtH9

https://photos.app.goo.gl/h7CFtcNo4CktTQwS8

https://photos.app.goo.gl/4XYgNGTGGUD5yVW2A

https://photos.app.goo.gl/obiKVEbq2WByQacB8

MelissaP1 (Alabama)
Posts: 13,836

Posted:

I can not tell you if landscaping is responsible for anything but mowing. Our lawncare only mowed. If you wanted something else done you had to pay them separately. They only did anything "extra" for common area and not individual yards if the HOA paid for something.

So need to know does your Landscapers do more than mow?

Former HOA President

RobB4 (Virginia)
Posts: 5

Posted:

I appreciate the response. Yes, they used to do everything. I pay a monthly fee to the condo association in addition to HOA The landscapers typically mow the lawn on a weekly basis during the summer months. They occasionally trim the plants and put down fresh mulch on top of the old stuff. My plants are also in dire need of trimming.

I’m almost positive the fault lies with them on this one. I might have to seek legal counsel which would probably be more cost effective at this point. They could use the kick in the butt. It would cost thousands to hire an independent landscaper.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Why going straight to legal? You did NOT hire the lawncare. Your HOA has. They are the ones you contact to contact the landscapers. You are just a customer via your HOA membership.

Former HOA President

KerryL1 (California)
Posts: 14,550

Posted:

Say, Rob, what do your documents, maybe your CC&Rs ("declaration") say about who cares for the landscaping and what kind of care should be given?

What does your HOA's contract with the landscaper say about their duties. You probably have to make a written request for a copy of it.

I'd read these materials waaaay before I gave any though to a lawsuit.

(When you write "they," I'm not sure you mean your HOA or the landscapers.)

SheliaH (Indiana)
Posts: 6,964

Posted:

Did you show these photos to the board? If so, what was the response?

And read your documents - as others have said, it should state who's responsible for landscaping (you've been there 12 years and should already know that). It may be some things are handled by the board, but not others (your pavers, for example?) If your neighbor's tree is hanging over your fence, you may have to take that up with them.

While you're at it, check the association financial reports. You're paying appropriately, but that doesn't mean there are some homeowners who do the same. There may also be other services the association has to pay for and some things may be taking more priority than others.

None of this is to say the board isn't responsible - if you've asked for maintenance to be done, someone could have told you from the beginning if it wasn't in the budget, it's homeowner responsibility and so on. You can sue if you want, but perhaps it would be better to talk to some of your neighbors and see if they feel the same way. If so, all of you should go to the next board meeting and speak your piece (it's not a good thing to ignore several angry homeowners). Bring your photos if necessary - sometimes people get used to certain things and don't realize how awful it really looks until they're forced to see it from another point of view.

If all of you are still ignored, maybe it's time to talk to other neighbors about voting in a new set of board members (YOU may have to be one of the candidates). If you (or they) win, then you can take a good look at the landscaping budget and the vendors and start to turn things around.

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

RobB4 (Virginia)
Posts: 5

Posted:

Thanks Sheila, I appreciate the detailed response. In addition to all the other feedback. My condo has the largest outside area compared to all the other units. It’s located at the end of the road and backs up in the woods. My neighbors properties require little maintenance. I feel like the landscapers are overwhelmed by my condo and chose to take the easy way out.

The association recently took out a $1.5 million loan to replace all the roofs. They are always underwater, and the rates keep going up. I feel a bit guilty for asking because things are so bad around here. I’m sure a good amount of people are not paying their bills. I always pay the amount due on time. I’m not the type of person to threaten someone in order to get something done. The independent landscaper made me realize the extent of the work required. Not easy to digest when paying them $334 month.

I think it would be wise for me to consult with someone that specializes in this area for an hr or two. I’m done with them taking advantage of me. It has become quite stressful.

JohnT38 (South Carolina)
Posts: 1,631

Posted:

Our landscape contract is posted on our website and all owners can view it. Can you get a copy of your contract and see what services they are suppose to provide?

RobB4 (Virginia)
Posts: 5

Posted:

Quote:

Posted By JohnT38 on 07/15/2020 6:24 PM
Our landscape contract is posted on our website and all owners can view it. Can you get a copy of your contract and see what services they are suppose to provide?

I believe they are obligated to provide it to me. I think this is a good place to start; I never requested this type of information.

Thanks.

CathyA3 (Ohio)
Posts: 6,299

Posted:

The fact that your association had to take out a loan to replace roofs tells me that it's badly underfunded. The landscaping is being neglected because the money is being spent on other, higher-priority items.

Unless someone embezzled funds or something like that, the cause of your financial problems is that your income (ie., your monthly assessments) does not cover your expenses. Your assessments should also include contributions to the reserve fund, which is money set aside to pay for the big ticket items like roofs. Many state condo laws require associations to set aside this money. You can't borrow your way out of financial trouble unless you have a solid plan to address the real issues and you follow the plan exactly.

It's not unusual for boards to set the assessments artificially low and then try to adjust their spending accordingly. This never works. It's understandable: boards don't want to look like the bad guys, they may have had push back from owners, your community may have a high rate of delinquencies (people not paying their assessments) and they haven't been able to collect these back-due assessments for whatever reason. Or they may have inherited a mess left by previous boards and are trying unsuccessfully to play catch up.

So there may be good reasons that your community is in financial trouble, or it may be ongoing mismanagement. Without really digging into several years worth of association records, you can't know what has happened.

The next question is, after you figure it out, what are you willing to do about it? A very common problem in condo communities is that people regard them as glorified apartments and are not willing to serve on their boards, or even pay attention to what is going on. Your current board may be incompetent, but they also may be in over their heads and nobody with more skills has volunteered.

People talk a lot about their rights as homeowners, but you rarely hear anyone complain about their responsibilities. If there isn't something unusual going on, such as criminal activity or an outside interest gaining control of the association, bad boards are always the fault of the homeowners who won't hold them to account or replace them with more skilled volunteers.

If those who see the problems won't do anything other than complain, who will solve them?

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By RobB4 on 07/15/2020 5:43 PM
The association recently took out a $1.5 million loan to replace all the roofs. They are always underwater, and the rates keep going up. I feel a bit guilty for asking because things are so bad around here. I’m sure a good amount of people are not paying their bills. I always pay the amount due on time. I’m not the type of person to threaten someone in order to get something done. The independent landscaper made me realize the extent of the work required. Not easy to digest when paying them $334 month.

Because of the loan, and contrary to your opinion that you are paying the condo association plenty, I think it is clear that what each unit is paying is in fact not enough to cover expenses.

The loan is a sign of serious financial problems. Sure, go ahead and talk to an attorney. Make sure you explain to the attorney that the condo association recently took out a 1.5 million dollar loan. The attorney can certainly send a demand letter.

If anyone on your condo's board can do the math and persuade the others on the board of the problems, then expect all units' monthly assessment to rise.

Ditto what CathyA3 posted.

GeorgeS21 (Florida)
Posts: 3,808

Posted:

Supporting those who commented that your association likely has MAJOR financial issues - related to owner not paying enough into reserve funds.

Further, if the reserve fund situation is this dire, there is a management - and, of course a homeowner issue.

Sounds like a clean look is needed - do you have a reserve study? Have you been to board meetings? Do you know your CCRs and Bylaws, etc? On a committee to assist in getting control of all this?

JohnC46 (South Carolina)
Posts: 14,265

Posted:

To remove old mulch would be very expensive and as the OP's association seems to be in financial trouble they cannot afford to do so.

MarkW18
Posts: 1,290

Posted:

I looked at the pictures and without having any information on what the current landscapers are supposed to be doing, no one can give an educated opinion on that situation.

In requires to the $334 you pay for fees, the others in your community are also paying that amount, maybe a little more and maybe a little less depending on the breakdown of fees. Now you bring up the $1.5M loan and some have considered your condo mismanaged, either by the Board or the management company. That might be the smartest way to pay for the largest expense your condo is going to have.

For example, complex of 200 units and $1.5M to replace/repair roofs would cost each homeowner $7500.00. A $1.5M loan paid over 30 years with a interest rate of 3.92% would cost the association $7,000 per month or $35.00 per homeowner. Let's say you're going to move in two years, would you rather spend $7500 for a roof you will only use for 2 years or $840.00 for the time you actually use it. When you sell the new owners continue with the payments.

SheliaH (Indiana)
Posts: 6,964

Posted:

Quote:

Posted By CathyA3 on 07/16/2020 5:53 AM
The fact that your association had to take out a loan to replace roofs tells me that it's badly underfunded. The landscaping is being neglected because the money is being spent on other, higher-priority items.

Unless someone embezzled funds or something like that, the cause of your financial problems is that your income (ie., your monthly assessments) does not cover your expenses. Your assessments should also include contributions to the reserve fund, which is money set aside to pay for the big ticket items like roofs. Many state condo laws require associations to set aside this money. You can't borrow your way out of financial trouble unless you have a solid plan to address the real issues and you follow the plan exactly.

It's not unusual for boards to set the assessments artificially low and then try to adjust their spending accordingly. This never works. It's understandable: boards don't want to look like the bad guys, they may have had push back from owners, your community may have a high rate of delinquencies (people not paying their assessments) and they haven't been able to collect these back-due assessments for whatever reason. Or they may have inherited a mess left by previous boards and are trying unsuccessfully to play catch up.

So there may be good reasons that your community is in financial trouble, or it may be ongoing mismanagement. Without really digging into several years worth of association records, you can't know what has happened.

The next question is, after you figure it out, what are you willing to do about it? A very common problem in condo communities is that people regard them as glorified apartments and are not willing to serve on their boards, or even pay attention to what is going on. Your current board may be incompetent, but they also may be in over their heads and nobody with more skills has volunteered.

People talk a lot about their rights as homeowners, but you rarely hear anyone complain about their responsibilities. If there isn't something unusual going on, such as criminal activity or an outside interest gaining control of the association, bad boards are always the fault of the homeowners who won't hold them to account or replace them with more skilled volunteers.

If those who see the problems won't do anything other than complain, who will solve them?

Amen! That's why I suggested looking at the finances. Doug also said the other areas of the community don't have the same landscaping issues, which is probably why nothing's being done in his area (the usual "not my problem so why should I care?"

Doug, I already suggested talking to your neighbors, but if that doesn't work, offering to assist the board with this is another option, especially since I'm sure the roofing is taking up a lot of their time. You said you thought you might need to sit down with a landscaping expert - why not talk to the board about this and offer to do the research as long as they pay for the expert (a consultation fee?) You can walk through the area with the expert and ask as many questions as you need to, and then present a report to the board (with a written report by the expert).

If the board's willing to pay for the consult, ask the expert which areas should take higher priority (e.g. the trees may endanger the roofs because large branches may fall) and that's where a conversation with the current landscaping vendor can start (which may or may not include finding another who will do what you want at a price you can afford).

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

SheliaH (Indiana)
Posts: 6,964

Posted:

Eeck - said Doug instead of Rob, sorry! (You get what I meant to say!)

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

CathyA3 (Ohio)
Posts: 6,299

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 10:21 AM
.... snippage ....
Let's say you're going to move in two years, would you rather spend $7500 for a roof you will only use for 2 years or $840.00 for the time you actually use it. When you sell the new owners continue with the payments.

Something I did not mention in my first response, but since MarkW18 brought it up:

There are issues with trying to sell a condo in a community with a large outstanding loan and (it appears) insufficient or non-existent reserves.

Lenders look at both of these things before deciding to approve a mortgage and may well steer clear of the community altogether. This means that potential buyers would either pay a higher interest rate, or may not get approved for a mortgage at all - meaning that the pool of buyers could be limited to those who can pay cash. This will drive down selling prices. All of this together may also attract well-heeled investors who often look for distressed properties in order to convert them to rentals.

This sort of thing can snowball. Realtors talk among themselves, and it can be bad when a community gets a reputation of being undesirable. This will further depress sales and drive down home prices.

So the kinds of issues that the OP talked about can go well beyond the immediate ones of landscaping being neglected and rising assessments.

MarkW18
Posts: 1,290

Posted:

Actually, that is not correct. I underwrote mortgage loans for Countrywide 15 years ago for many borrowers in HOA's throughout the country. This type of loan would not be a problem as there was sufficient collateral to repay the loan. Having high delinquencies, high rentals and no reserves would be an issue. This is an extremely smart way to finance your largest expense over time, while maintaining a healthy reserve for your less costlier reserve components.

I managed a large complex in Southern California with a similar issue using a SBA loan and to my knowledge never had a problem with lender restricting access to funds or at higher than normal rates.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

One HOA I belonged to (home values $400K to $475 in 2000, dues at $400 per month), some 25 or so standalone homes but mainly buildings with 3-4, two story townhomes (with full basements) per building and 175 owners. Reserves were good but they got hit with a major, unforseen whammy. The siding used had water intrusion problems and all the siding and a lot of the underlayment/flashing needed to be replaced. The major problem was that the siding was no longer manufactured. There were a few other things like 175 garage doors needing replacement, 175 two to three brick front steps needed replacing, and a new maintenance shed was needed. The monthly dues ($400 in 2000) with the major items being private roads and several large private septic systems servicing all 175 homes.The reserves while good, could not handle the additional cost so a Special Assessment was in order.

The BOD did a great job in explaining it all and laying out the costs. There were several meetings held to explain/show it all. It would be a two year project with a Special Assessment of $20K to $25K per owner for a total of near $4.5 million. The BOD worked with a local bank to arrange a 5 year loan program underwritten by the BOD. Each owner would have 5 years to pay off the assessment with a variety of plans offered ranging from pay within 90 days with no interest or finance over 3 to 5 years with interest. It required 75% of all owners to approve. It passed with 88% of all owers approving. There were some disgruntled owners that banded together to sue to stop it. The courts ruled it was done legally according to the Covenants and the suit was dismissed in a NY Minute.

The place looked awesome when done. Even many of the objectors agreed. This was 20 years ago and today the place still looks awesome. Homes now selling for $425K to $500K. Dues now about $500 per month.

It turned out that the Special Assessment became a bargaining point when a unit sold. Some buyers assumed the Special Assessment, some demanded it be paid off by the seller, etc.

Some times one has to put up or shut up.

CathyA3 (Ohio)
Posts: 6,299

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 1:02 PM
Actually, that is not correct. I underwrote mortgage loans for Countrywide 15 years ago for many borrowers in HOA's throughout the country. This type of loan would not be a problem as there was sufficient collateral to repay the loan. Having high delinquencies, high rentals and no reserves would be an issue. This is an extremely smart way to finance your largest expense over time, while maintaining a healthy reserve for your less costlier reserve components.

I managed a large complex in Southern California with a similar issue using a SBA loan and to my knowledge never had a problem with lender restricting access to funds or at higher than normal rates.

Actually... Countrywide was at the heart of the sub-prime mortgage meltdown. Lending standards have tightened up since then - although since we seem not to learn from our mistakes, I would not be surprised if we tried this nonsense again.

Remember the phrases "liar's loans" and "toxic assets"? Lenders did interesting things such as not verifying borrowers' income or other information. Lenders who had no intention of holding their loans didn't care much about how likely it was the borrowers would repay. Instead the "crap" loans were bundled together with good ones and sold to unwary investors as mortgage-backed securities, and further securitized into derivative investments. The ratings agencies were found to have colluded in this financial shell game, rating risky arbage investments as AAA - their standards got tightened up as well after the music stopped, which it did with a bang.

Another of the complaints against Countrywide and other sub-prime lenders is that they steered uninformed buyers toward products that generated a lot of revenue for the lender at the expense of the borrower. Eventually it all caught up with them - at one point the company disclosed a stunning $1.2 billion loss as loan losses surged - and they were eventually acquired by Bank of America (I think).

I do take your point about wise use of loans by financially savvy people. The OP's comments make me believe that his board may not be among the savvy.

MarkW18
Posts: 1,290

Posted:

Quote:

Posted By CathyA3 on 07/16/2020 2:36 PM

Posted By MarkW18 on 07/16/2020 1:02 PM
Actually, that is not correct. I underwrote mortgage loans for Countrywide 15 years ago for many borrowers in HOA's throughout the country. This type of loan would not be a problem as there was sufficient collateral to repay the loan. Having high delinquencies, high rentals and no reserves would be an issue. This is an extremely smart way to finance your largest expense over time, while maintaining a healthy reserve for your less costlier reserve components.

I managed a large complex in Southern California with a similar issue using a SBA loan and to my knowledge never had a problem with lender restricting access to funds or at higher than normal rates.

Actually... Countrywide was at the heart of the sub-prime mortgage meltdown. Lending standards have tightened up since then - although since we seem not to learn from our mistakes, I would not be surprised if we tried this nonsense again.

Remember the phrases "liar's loans" and "toxic assets"? Lenders did interesting things such as not verifying borrowers' income or other information. Lenders who had no intention of holding their loans didn't care much about how likely it was the borrowers would repay. Instead the "crap" loans were bundled together with good ones and sold to unwary investors as mortgage-backed securities, and further securitized into derivative investments. The ratings agencies were found to have colluded in this financial shell game, rating risky arbage investments as AAA - their standards got tightened up as well after the music stopped, which it did with a bang.

Another of the complaints against Countrywide and other sub-prime lenders is that they steered uninformed buyers toward products that generated a lot of revenue for the lender at the expense of the borrower. Eventually it all caught up with them - at one point the company disclosed a stunning $1.2 billion loss as loan losses surged - and they were eventually acquired by Bank of America (I think).

I do take your point about wise use of loans by financially savvy people. The OP's comments make me believe that his board may not be among the savvy.

More inaccurate information provided by Cathy.

Only 3% of Countrywide's portfolio was from sub-prime mortgages, of which 85% were of high quality, because they were full doc loans, not the "liar" loans you're referring to.

The real Countrywide went under is not even close to what Cathy is alluding to. Countrywide had a Bank that there was a run on when the secondary market collapse and $50B of Pay-Option loans were held there. Bank of America got a $40B company for just $6B. Actually Countrywide is alive and well, only it is called PennyMac, residing in the same building and outside of Angelo Mozilo, is run by the same leadership that made it the largest mortgage banker in the world.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 4:02 PM

Posted By CathyA3 on 07/16/2020 2:36 PM

Posted By MarkW18 on 07/16/2020 1:02 PM
Actually, that is not correct. I underwrote mortgage loans for Countrywide 15 years ago for many borrowers in HOA's throughout the country. This type of loan would not be a problem as there was sufficient collateral to repay the loan. Having high delinquencies, high rentals and no reserves would be an issue. This is an extremely smart way to finance your largest expense over time, while maintaining a healthy reserve for your less costlier reserve components.

I managed a large complex in Southern California with a similar issue using a SBA loan and to my knowledge never had a problem with lender restricting access to funds or at higher than normal rates.

Actually... Countrywide was at the heart of the sub-prime mortgage meltdown. Lending standards have tightened up since then - although since we seem not to learn from our mistakes, I would not be surprised if we tried this nonsense again.

Remember the phrases "liar's loans" and "toxic assets"? Lenders did interesting things such as not verifying borrowers' income or other information. Lenders who had no intention of holding their loans didn't care much about how likely it was the borrowers would repay. Instead the "crap" loans were bundled together with good ones and sold to unwary investors as mortgage-backed securities, and further securitized into derivative investments. The ratings agencies were found to have colluded in this financial shell game, rating risky arbage investments as AAA - their standards got tightened up as well after the music stopped, which it did with a bang.

Another of the complaints against Countrywide and other sub-prime lenders is that they steered uninformed buyers toward products that generated a lot of revenue for the lender at the expense of the borrower. Eventually it all caught up with them - at one point the company disclosed a stunning $1.2 billion loss as loan losses surged - and they were eventually acquired by Bank of America (I think).

I do take your point about wise use of loans by financially savvy people. The OP's comments make me believe that his board may not be among the savvy.

More inaccurate information provided by Cathy.

Only 3% of Countrywide's portfolio was from sub-prime mortgages, of which 85% were of high quality, because they were full doc loans, not the "liar" loans you're referring to.

The real Countrywide went under is not even close to what Cathy is alluding to. Countrywide had a Bank that there was a run on when the secondary market collapse and $50B of Pay-Option loans were held there. Bank of America got a $40B company for just $6B. Actually Countrywide is alive and well, only it is called PennyMac, residing in the same building and outside of Angelo Mozilo, is run by the same leadership that made it the largest mortgage banker in the world.

Thanks for the info.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

CountryWide screwed me over when bought my first house. Knew what I was doing. So would not use them again. Had to refinance to get out of that mess.

We are allowed to cut any tree limbs that fall over the property line. So if there are limbs coming over a fence then it should be within your rights to trim those back on your end.

Sometimes you have to do the work yourself or pay someone to do it. It may still be considered your responsibility since it's above the normal "mowing".

Former HOA President

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 10:21 AM
For example, complex of 200 units and $1.5M to replace/repair roofs would cost each homeowner $7500.00. A $1.5M loan paid over 30 years with a interest rate of 3.92% would cost the association $7,000 per month or $35.00 per homeowner. Let's say you're going to move in two years, would you rather spend $7500 for a roof you will only use for 2 years or $840.00 for the time you actually use it. When you sell the new owners continue with the payments.

When said owner goes to sell to a buyer who needs a mortgage, the lender will factor the extra $35 extra per month into the calculation of how much the lender is willing to loan the buyer. The extra $35 per month will result in several thousand dollars less house that the buyer can afford.

The math for MarkW18's hypothetical, where the owner sells after a couple of years, has the owner of the home paying just about the full price of the new roof regardless of whether the board imposes a large special assessment or takes out a loan.

Cathy A3 is correct that increasing the assessment will, in general, drive down selling prices.

As for Countrywide: It was one of the most corrupt and leading players in the subprime meltdown. Investigative reporting has documented well that giving Countrywide any benefit of the doubt during the years leading up to 2008-2009 is a fool's errand.

MarkW18
Posts: 1,290

Posted:

Quote:

Posted By AugustinD on 07/16/2020 6:41 PM

Posted By MarkW18 on 07/16/2020 10:21 AM
For example, complex of 200 units and $1.5M to replace/repair roofs would cost each homeowner $7500.00. A $1.5M loan paid over 30 years with a interest rate of 3.92% would cost the association $7,000 per month or $35.00 per homeowner. Let's say you're going to move in two years, would you rather spend $7500 for a roof you will only use for 2 years or $840.00 for the time you actually use it. When you sell the new owners continue with the payments.

When said owner goes to sell to a buyer who needs a mortgage, the lender will factor the extra $35 extra per month into the calculation of how much the lender is willing to loan the buyer. The extra $35 per month will result in several thousand dollars less house that the buyer can afford.

The math for MarkW18's hypothetical, where the owner sells after a couple of years, has the owner of the home paying just about the full price of the new roof regardless of whether the board imposes a large special assessment or takes out a loan.

Cathy A3 is correct that increasing the assessment will, in general, drive down selling prices.

As for Countrywide: It was one of the most corrupt and leading players in the subprime meltdown. Investigative reporting has documented well that giving Countrywide any benefit of the doubt during the years leading up to 2008-2009 is a fool's errand.

CLUELESS, ON ALL COUNTS.

But you're the expert.

GeorgeS21 (Florida)
Posts: 3,808

Posted:

Oh, Mark, enough already.

MarkW18
Posts: 1,290

Posted:

Quote:

Posted By GeorgeS21 on 07/16/2020 7:09 PM
Oh, Mark, enough already.

SHUT UP!

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 6:53 PM

Posted By AugustinD on 07/16/2020 6:41 PM

Posted By MarkW18 on 07/16/2020 10:21 AM
For example, complex of 200 units and $1.5M to replace/repair roofs would cost each homeowner $7500.00. A $1.5M loan paid over 30 years with a interest rate of 3.92% would cost the association $7,000 per month or $35.00 per homeowner. Let's say you're going to move in two years, would you rather spend $7500 for a roof you will only use for 2 years or $840.00 for the time you actually use it. When you sell the new owners continue with the payments.

When said owner goes to sell to a buyer who needs a mortgage, the lender will factor the extra $35 extra per month into the calculation of how much the lender is willing to loan the buyer. The extra $35 per month will result in several thousand dollars less house that the buyer can afford.

The math for MarkW18's hypothetical, where the owner sells after a couple of years, has the owner of the home paying just about the full price of the new roof regardless of whether the board imposes a large special assessment or takes out a loan.

Cathy A3 is correct that increasing the assessment will, in general, drive down selling prices.

As for Countrywide: It was one of the most corrupt and leading players in the subprime meltdown. Investigative reporting has documented well that giving Countrywide any benefit of the doubt during the years leading up to 2008-2009 is a fool's errand.

CLUELESS, ON ALL COUNTS.

Do tell me where on a loan application the applicant is allowed to omit the extra $35 per month in your hypothetical.

The math does not lie.

MarkW18
Posts: 1,290

Posted:

You really think an extra $35.00 per month is going to make or break a loan application? NO

Let's take another scenario that occured where I live. People moved out to the burbs. Monthly gasoline bills were $100.00 monthly, then once they may the move, the gas credit card went to $600.00 or more. Ever see a gasoline bill show up on a loan app, NOPE.

Countrywide, in its three mortgage units, retail, wholesale and correspondence, funded $50 billion each month on average, of which ONLY 3% was subprime. How was that the leading player in the subprime market?

You might want to look at Fannie Mae and FHA as far as corruption goes. They were approving loans with 500 or below credit score. They were government regulated agency under a Republican administration.

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 7:32 PM
You really think an extra $35.00 per month is going to make or break a loan application? NO

Are you really this math illiterate? Apparently yes. Of course an extra $35 per month of expenses can make or break a loan application. I have firsthand experience with these numbers. In 2013 two days before closing on a home sale, my realtor called and said the deal was off. Why? Because those who processed the loan failed to include the HOA assessment of $40 per month. At the approved interest rate, this amounted to about $5000 less house that the buyer could afford. I checked the numbers. They were spot on: $40 more expense per month, at the approved interest rate, translated to the buyer qualifying for about $5000 less of a loan. The buyer (a veteran who though his VA loan had been approved) had practically no money to put down. The deal fell through.

You won't do the math. Others will. Or for crying out loud, any online mortgage calculator will repeat what I have said here.

From https://www.newyorker.com/magazine/2009/06/29/angelos-ashes:
"By early 1998, Full Spectrum [the subsidiary Countrywide created for its subprime loans] had thirty offices in seventeen states, and subprime loans accounted for about six per cent of Countrywide’s mortgages." The New Yorker, among others, documents how Countrywide was in a race to become the leading mortgage lender in the country. How would it achieve this? With leading the way on the then highly lucrative (and high risk) subprime loans and cheating when it came to qualifying borrowers.

MarkW18
Posts: 1,290

Posted:

In 2005, when I was an analyst for Countrywide, our subprime accounted for only 3% of the total portfolio. Of that, 85% were current on their monthly mortgage payments. We funded $600B. Do the math, and tell the audience how Countrywide was the leading subprime lender.

In regards to the lousy $35.00, rub you crystal ball and give me your wisdom. Took over a HOA in 2018 that hadn't re-done their roofs in 20 plus years. The last three years their roof repairs from rain were $24K, $58K and this year $106K. We have three bids to re-do and they average $800K. The roofs have to be done. So, I could do a SA for $8247 each unit or $700 per month for one year or $35.00 per month for 30 years.

I can't worry about the next person trying to buy into the complex, my fiduciary responsibility is to the current owner paying their dues and them viable options. Based on my meeting with the Board tonight, they agree with my assessment. That's all that counts.

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 8:04 PM
In regards to the lousy $35.00 [extra per month]

This is exactly how I would expect a Countrywide employee from circa 2005-2007 to react. Taking the concrete numbers of a loan application (that determine precisely how much mortgage an applicant is allowed) and turning these numbers into friggin' excrement Jello is exactly why Countrywide went down the commode.

You have represented Countrywide's employees' talent superbly here.

MarkW18
Posts: 1,290

Posted:

Quote:

Posted By AugustinD on 07/16/2020 8:22 PM

Posted By MarkW18 on 07/16/2020 8:04 PM
In regards to the lousy $35.00 [extra per month]

This is exactly how I would expect a Countrywide employee from circa 2005-2007 to react. Taking the concrete numbers of a loan application (that determine precisely how much mortgage an applicant is allowed) and turning these numbers into friggin' excrement Jello is exactly why Countrywide went down the commode.

You have represented Countrywide's employees' talent superbly here.

You have just accentuated the true meaning of a "IDIOT" When giving the opportunity to provide a solution come up with that bull$hit of an answer.

I work on behalf of an association. I don't provide mortgages, I don't list or sell homes, I don't handle rentals. I don't give a rat's a$$ how much mortgage one can qualify for. The task I was handed was getting a roof fixed on 25 buildings. If you personally can't qualify, oh well, I am sure someone else will.

You like shooting blanks?

MarkW18
Posts: 1,290

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Quote:

Posted By MelissaP1 on 07/16/2020 5:02 PM
CountryWide screwed me over when bought my first house. Knew what I was doing. So would not use them again. Had to refinance to get out of that mess.

In the event you missed the newspaper clippings, Countrywide was purchased by Bank of America in 2008.

GeorgeS21 (Florida)
Posts: 3,808

Posted:

In case any of those coming to this site for advice have missed it, MarkW18 apparently has some issues. Not the least among them name calling and bullying.

In my opinion, you should be very careful of the advice you accept.

MarkW18
Posts: 1,290

Posted:

Quote:

Posted By GeorgeS21 on 07/17/2020 6:30 AM
In case any of those coming to this site for advice have missed it, MarkW18 apparently has some issues. Not the least among them name calling and bullying.

In my opinion, you should be very careful of the advice you accept.

Georgie, are you being bullied. You know they have professionals that can help you with your issues, but I would do it sooner than later. Best of luck to you, I really mean it.

MarkW18
Posts: 1,290

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Quote:

Posted By CathyA3 on 07/16/2020 5:53 AM
The fact that your association had to take out a loan to replace roofs tells me that it's badly underfunded. The landscaping is being neglected because the money is being spent on other, higher-priority items.

Unless someone embezzled funds or something like that, the cause of your financial problems is that your income (ie., your monthly assessments) does not cover your expenses. Your assessments should also include contributions to the reserve fund, which is money set aside to pay for the big ticket items like roofs. Many state condo laws require associations to set aside this money. You can't borrow your way out of financial trouble unless you have a solid plan to address the real issues and you follow the plan exactly.

It's not unusual for boards to set the assessments artificially low and then try to adjust their spending accordingly. This never works. It's understandable: boards don't want to look like the bad guys, they may have had push back from owners, your community may have a high rate of delinquencies (people not paying their assessments) and they haven't been able to collect these back-due assessments for whatever reason. Or they may have inherited a mess left by previous boards and are trying unsuccessfully to play catch up.

So there may be good reasons that your community is in financial trouble, or it may be ongoing mismanagement. Without really digging into several years worth of association records, you can't know what has happened.

The next question is, after you figure it out, what are you willing to do about it? A very common problem in condo communities is that people regard them as glorified apartments and are not willing to serve on their boards, or even pay attention to what is going on. Your current board may be incompetent, but they also may be in over their heads and nobody with more skills has volunteered.

People talk a lot about their rights as homeowners, but you rarely hear anyone complain about their responsibilities. If there isn't something unusual going on, such as criminal activity or an outside interest gaining control of the association, bad boards are always the fault of the homeowners who won't hold them to account or replace them with more skilled volunteers.

If those who see the problems won't do anything other than complain, who will solve them?

You suggest this association is in financial trouble because they took out a $1.5M loan, BUT, IF they were in financial trouble, how did they obtain the $1.5M loan?

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 8:57 PM

Posted By AugustinD on 07/16/2020 8:22 PM

Posted By MarkW18 on 07/16/2020 8:04 PM
In regards to the lousy $35.00 [extra per month]

This is exactly how I would expect a Countrywide employee from circa 2005-2007 to react. Taking the concrete numbers of a loan application (that determine precisely how much mortgage an applicant is allowed) and turning these numbers into friggin' excrement Jello is exactly why Countrywide went down the commode.

You have represented Countrywide's employees' talent superbly here.

[snip nonsense that fails to address MarkW18's financial math illiteracy]

Quote:

Posted By MarkW18 on 07/16/2020 10:21 AM

For example, complex of 200 units and $1.5M to replace/repair roofs would cost each homeowner $7500.00. A $1.5M loan paid over 30 years with a interest rate of 3.92% would cost the association $7,000 per month or $35.00 per homeowner. Let's say you're going to move in two years, would you rather spend $7500 for a roof you will only use for 2 years or $840.00 for the time you actually use it. When you sell the new owners continue with the payments.

Quote:

Posted By MarkW18 on 07/16/2020 7:32 PM
You really think an extra $35.00 per month is going to make or break a loan application? NO

When you post falsehoods you are going to be called out on them. That you contend that an assessment increase of $35 will not affect how much loan an applicant will qualify for, and that said increase will not drive down sales prices, is entirely consistent with the incompetence of Countrywide staff circa 2005.

MarkW18
Posts: 1,290

Posted:

When has it become the responsibility of a PM, Board president, olr a Board member to determine how much a applicant can qualify for on a loan?

I've be in a lot of board meetings over the past 11 years, NEVER once has there ever been a discussion when the prospect of raising dues or creating a special assessment might affect the loan applicant, Augustin Doo-Doo, who is looking at a home in our community but the buyer is greedy and is taking multiple offers and raising the price.

What happens when someone buys a house and three months later has a $4800.00 special assessment that they didn't vote on. It all happened while they were buying the house.

Go back to doing research, being logical just doesn't suit you.

GeorgeS21 (Florida)
Posts: 3,808

Posted:

Any who are reading this ...

Please note Mark continues to attempt to bully - in this case, by calling others names.

A very negative sign to me. More the behavior of an angry fifth grader, than that of a professional giving advice.

Given this, and in my opinion, again - be careful of the advice you consider.

MarkW18
Posts: 1,290

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Quote:

Posted By GeorgeS21 on 07/17/2020 8:55 AM
Any who are reading this ...

Please note Mark continues to attempt to bully - in this case, by calling others names.

A very negative sign to me. More the behavior of an angry fifth grader, than that of a professional giving advice.

Given this, and in my opinion, again - be careful of the advice you consider.

Who am I bullying? Their name is AugustinD. I am only guessing what the D stands for. If it isn't Doo-Doo, then I humbly apologize. wink..wink

MarkW18
Posts: 1,290

Posted:

Quote:

Posted By GeorgeS21 on 07/17/2020 8:55 AM
Any who are reading this ...

Please note Mark continues to attempt to bully - in this case, by calling others names.

A very negative sign to me. More the behavior of an angry fifth grader, than that of a professional giving advice.

Given this, and in my opinion, again - be careful of the advice you consider.

In case you haven't noticed, I am defending the HOA, while this unnamed individual is saying you, as a board president, have a responsibility, when raising dues or creating a special assessment in how it might affect, this same unnamed individual, of how much home they qualify for.

Chime in anytime!

GeorgeS21 (Florida)
Posts: 3,808

Posted:

Nope, MarkW18, you are attempting to bully by making up names - a la 5th graders on the playground.

I understand the tactic and the type - some may not. Just want to make certain those that visit this site, note this tendency - and, understand what it means - at least to me.

I don't usually listen to people who bully, using that tactic or any of the other methods of bullying.

MarkW18
Posts: 1,290

Posted:

Quote:

Posted By GeorgeS21 on 07/17/2020 9:41 AM
Nope, MarkW18, you are attempting to bully by making up names - a la 5th graders on the playground.

I understand the tactic and the type - some may not. Just want to make certain those that visit this site, note this tendency - and, understand what it means - at least to me.

I don't usually listen to people who bully, using that tactic or any of the other methods of bullying.

You won't answer the question, but continue to cry you're being bullied. Ok, so be it.

GeorgeS21 (Florida)
Posts: 3,808

Posted:

Yep.

Like I said - the point of me continuing to post following your bullying episodes, is so everyone visiting this site will see what you do - and, account for it in some way when reading your posts.

If you were a director on a Board on which I was also a director, I would first be embarrassed by what you said (assuming you interacted in person the way you interact here), then would spend some amount of time working to convince most to ignore you, then spend some time working to have someone else elected in your place.

The name calling and bullying may not be meaningful to some, but, as you can tell, it certainly is to me.

AugustinD
Posts: 5,144

Posted:

Well said, GeorgeS21.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Ya made me re-live my "Countrywide" nightmare all over again... LOL! It's almost like you all were in the Countrywide office with me and Mark! LOL!

Yes, the $50 dues did factor into my loan. I could have gotten a bigger house because of it. Plus not put my home at risk for lien/foreclosure or special assessments. Not sure how a reputable loan officer would neglect to inform a customer this.

Countrywide immediately sold my loan without notice 1st month after bought my 1st house. Not cool!

Former HOA President

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By MelissaP1 on 07/17/2020 3:40 PM
Not sure how a reputable loan officer would neglect to inform a customer this.

At the prompting of my realtor (who of course lost a commission), the VA loan administrator was informed, with somewhat more tact, of how little I thought of his company. I was particularly displeased that they were treating a veteran (the buyer) so poorly.

I am glad you are no longer at the mercy of pathetic, corrupt Countrywide.

GenoS (Florida)
Posts: 4,276

Posted:

Quote:

Posted By MarkW18 on 07/16/2020 8:04 PM
In 2005, when I was an analyst for Countrywide, our subprime accounted for only 3% of the total portfolio. Of that, 85% were current on their monthly mortgage payments. We funded $600B. Do the math, and tell the audience how Countrywide was the leading subprime lender.

The wheels didn't start to come off the subprime lending business until 2007.

Here's Countrywide's 10-K for 2007. I don't see where you get your 3% figure from. Your math isn't any better today than it was in Countrywide's heydays of fraud.

From The New Yorker, "By early 2007, subprime defaults were rising rapidly. Mozilo often emphasized that subprime mortgages composed only a small per cent of Countrywide’s business, but his company was still one of the biggest subprime lenders in the country."

That's an awful lot of Kool Aid you've been sucking down there. "Do the math"? You left out the part where Countrywide was STILL one of the biggest subprime lenders in the country.

"As other subprime lenders went out of business, Countrywide began picking up an increasing volume of loans, many of which made their way onto the company’s balance sheet. As late as July, 2007, Countrywide was originating billions of dollars of loans that one analyst estimated would likely be salable only at a loss."

Mozillo knew what he was doing: setting the company up for failure. But he didn't bother to tell anyone else, instead opting to sell his shares of the company for millions of dollars in profit. Mozillo's lucky he was able to slither out of any real punishment.

"In 2009, the SEC accused Mozilo of duping investors about how vulnerable Countrywide was to subprime mortgages — and then using inside information to dump $139 million of his own shares in 2006 and 2007 before they tanked."

Such a guy.

In 2007, "Homeowners, meanwhile, drawn in by Countrywide sales scripts assuring “the best loan possible,” are behind on their mortgages in record numbers. As of June 30, almost one in four subprime loans that Countrywide services was delinquent, up from 15 percent in the same period last year, according to company filings. Almost 10 percent were delinquent by 90 days or more, compared with last year’s rate of 5.35 percent."

The Oasis of Rapport. Ever hear of it? Ever do it? "If clients proved to be uninterested, the script provided ways for sales representatives to be more persuasive." A hallmark of telemarketer scum.

What objectionable fraudsters all of your colleagues were. Countrywide was indisputably a key player in the subprime fiasco that started the ball rolling in the Great Financial Crisis. I don't even like thinking about Countrywide, much less writing about it here, but you force me to do so whenever you post your unadulterated BS.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

I am glad too. I hear "Countrywide" and I cringe...

Mind you was an educated home buyer. My Realtor acted as my "buyer's agent". That time period mortgage companies were really untrustworthy. Selling questionable products to people that really shouldn't have been buying homes. Not that they didn't deserve or need a home. Just not set up financially and ready for the responsibility of home ownership.

Luckily for me, I went in demanding NOTHING less than a 30 year FIXED rate loan. The products they kept trying sell me instead were just sickening. I felt really bad for those who fell for them. The people who ended up losing their homes over these is shameful.

Former HOA President