delinquent accounts

Started by JamesO4 • 3 replies • 1251 views

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JamesO4 (California)
Posts: 7

Posted:

Not asking for specific legal advice, of course, but general comments: If a homeowner is many, many months behind in paying monthly HOA fee, possibly has filed personal bankruptcy, and his condo has a market value of $175K and mortgage of $350K.......is there anything to be gained by the HOA in spending the attorney fees to initiate foreclosure proceedings? Naturally, a lien was filed previously, but since there is no equity....would spending a few thousand on attorneys fees be good money after bad?

MaryA1 (Arizona)
Posts: 7,043

Posted:

James,

IMO, definitely not worth the expense! That's why HOAs should have a "bad debts" budget line item. My board is faced with voting to write off monies each month because of the number of foreclosures resulting in uncollectable delinquencies. The best financial plan is to budget for these bad debts. Depending upon the number of delinquencies (and the dollar amount uncollectable) it may not even be necessary to raise the assessments. Our HOA hasn't had to so far.

KirkW1 (Texas)
Posts: 1,665

Posted:

There might be something to be gained, but it won't be money. It will only do some good in the event that either the person is a bad neighbor and thus throwing them out, or to prove to others with the ability that you are willing.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Sue in small claims court. You dont know he is going to file bankruptcy.

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