Homeowner HOA Assistance

Hello- I am in a HOA in Atlanta, GA. We've got an owner who bought out most expensive unit ever in March, 2021.

Since then, we've had to sue him once to pay his dues, we've sent him to collections twice more and are preparing to sue him again. He's leased out his place on AirBnB and on Peerspace against our rules and lied about it. He's also made payments on our management company's site only to void them immediately after. He repeated this behavior for about 3 months to look like he's paid.

Now, he's found a program in Georgia that's offering to pay all of his past due balance as a one time "grant".

As the owner has been nothing but a headache since moving in, would it be incorrect to decline the programs grant and move towards foreclosure? They want to pay us directly and need paperwork to do so. From my understanding, we are under no obligation to accept the money.

thank you.

By accepting the grant money, we are just delaying him going back to collections as he's not going to be able to afford his $700 dues in December or January.

By accepting the grant money, we are just delaying him going back to collections as he's not going to be able to afford his $700 dues in December or January.

This sounds like a call to your PMC legal group is more than appropriate. Please let us know the conclusion.

Personally, I would suggest taking the money offered.
To do otherwise may cause issues in the future and, in my opinion, not fulfilling your fiduciary duty to the Association.

I would also talk to the attorney about:

1) enforcing covenant on short term rental.
2) how to handle missed payments in the future.

Thank you.

For what our attorney has said, in the State of Georgia, the only way to foreclose is to get a judgement, which requires a lawsuit.

We don't want to sue anyone, we would much rather people pay their dues on time, but that isn't happening.

A lien is a judgement too. It is stronger and cheaper than a lawsuit. Not sure what kind of lawyer you have. Be careful of ones that tell you "I will do what you tell me to do". It can be code there other options they are not telling you like a lien process ... Which much better off doing.

Bob,

I said to take the money and start the clock over again because if the Association didn't know where the money came from, they would likely take a check from the person.
Well, perhaps a money order (since they stopped payment on previous payments).

I would like to know more about this "Grant" and it's relationship to the HOA. Take the money and apply it to the money owed. However, do NOT sign anything or be involved with the granting of the grant. This is all on the owner. Do not expect HOA support or involvement with anything other than taking of the physical cash or check.

The grant comes directly from a Georgia Housing assistance office who is helping people who are impacted by COVID 19. The guy bought his condo for $465,000 in March, 2021 but that doesn't seem to matter to them. The level of scrutiny on his need has been seemingly zero.

All we were asked to do is to fill out a W9 form for tax purposes as the money from the housing assistance office is considered income.

We are going to continue to have this owner make his payments through our attorney's office so that he cannot bounce anymore payments and trick up into thinking he's paid when he hasn't.

That was my thought too but our attorney said that if a homeowner offered a payment we had to accept it. In this case, the homeowner isn't offering payment but rather we are being offered payment on his behalf.

Our two other board members wanted to take the money.

I did raise all of my concerns regarding potential fraud with the agency, but I was ignored. In his grant, they are covering $1000 in fines from his short term renting, $200 in NSF fees, attorneys collection costs, interest and late fees.

This grant enables all of his bad behavior.

I agree with the attorney. The source of these funds are not the HOA's business. HOAs can put conditions on accepting payments from delinquent owners - for example, not accepting partial payments any longer - but source of funds, no. Would the HOA get all up in this guy's business if the funds are a gift or an inheritance? Very unlikely. And if this does go to foreclosure, there are some judges out there who think that HOAs are a bunch of nasty bullies and are looking for any reason to find in favor of the homeowner. When we dealt with our delinquent accounts, we made sure we had a paper trail showing that we bent over backwards to work with the owner and get them back on track.

(To be clear, I have very little patience with people who make bad choices, and no patience at all with those who game the system. I'm firmly on the HOA's side here - but the board has to dot the i's and cross the t's - otherwise they risk doing something wrong that makes them unable to collect the money that's owed.)

The board shouldn't touch it with a ten foot pole. He's a scammer and wants to drag you into it.

The HOA attorney is already involved with communications and accepting payment from this owner. I would listen to the attorney and follow his instructions - because if push comes to shove, the board can plausibly argue that doing so was acting in the best interests of the HOA. (Although in my experience, the HOA is not obligated to accept partial payments. This is especially true of the total amount owed is fairly small. Accepting small amounts can make it impossible to foreclose, since on paper it appears that the owner is making a good faith effort to get caught up on payments. It's one of the ways deadbeats game the system. Next will be a bankruptcy filing, which stops all collection actions.)

There was a lot of fraud involved with the covid relief programs, and the taxpayers footed the bill for a lot of stuff they shouldn't have. Will the government come after people who knowingly accepted money they weren't entitled to? Probably Uncle Sam has bigger problems on his hands, but I can think of a number of ways this can come back to bite the HOA.

If this grant or whatever it is part of COVID relief, we know there have been several instances of people gaming the system, and so I agree with others who've said this stinks to high heaven. The guy bought a condo for over $400K, so I suspect he has the money to pay you, but doesn't want to, and now thinks he's found a way for someone else (taxpayers) to pick up the tab. Wonder what would happen if someone reported this to the grant authorities and suggest they might want to take another look at the guy's finances and what he really plans to do with the money....

Oh, look there is a hotline where you could report complaints - https://www.pandemicoversight.gov/contact/about-hotline That said, I wouldn't do that just yet - you need to keep talking to your attorney and perhaps compel this guy to spill his guts about his failure/refusal to pay up. Maybe he tells you who's handling his application and then you report your reservations to him or her.

I know you're reluctant to sue, but having dealt with this stuff for five of my 10 years on the board, I found there were instances where we had no choice. By then, my attitude was "get him/her/them the hell out of the community." The association wasn't getting paid anyway and we'd end up writing it off, so why should these people enjoy living in their home or collecting rent checks until the ax fell? Then there were the people who'd file bankruptcy over and over again to stop the foreclosure by the association, but that's another story for another day.

It should be noted that the owner does face consequences for getting this grant. It's not necessarily "Free money". The form the grant is received can be in a short term loan or can act similar to a lien to their home. They may not be able to sell or rent as readily. This is a ONE time deal for this person. Take the money to apply to the unpaid dues owed. This will prevent the foreclosure as the purpose of this grant was put in place for. However, it's not to be used to pay fines. Again Fines can NOT be the basis for a foreclosure. (Most states).

Just make sure from now on to apply non-payment of dues to their account if they keep not paying their dues. Fines are subjective and punitive. Legal expenses may be recoverable.