After HOA foreclosure & next steps

Started by MarkM19 • 7 replies • 1794 views

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MarkM19 (Texas)
Posts: 65

Posted:

I am a Board member of a 430 home HOA. We recently foreclosed on a Home that was not paying the HOA dues, about 6K behind. We are the owner of record on the property but have not had any luck getting the Ex owner to leave. We have offered them Cash for Keys and they refused and cussed out the person delivering the message. They told them that they still own the house. The PM said that now we have a additional 90 day process to start in order to evict these people.

My question is if we own the Home they are not the Homeowner we are. To me they are non paying squatters. As I have seen with other properties in our development when the Bank finally gets around to it they send a LockSmith and break the door in and change locks.

I am hoping someone out there has some expertise on this matter because our PM seems willing to wait it out and that will cost us more money and take more time.

Thanks in advance.
Mark

GlenL (Ohio)
Posts: 5,491

Posted:

Mark, you need to follow the law and get legal advice on the matter but generally a homeowner has a 90 day window to reclaim their home and you must allow it. As much as you would like to throw them out and be done with them. One thing that can be done is to ask the court to appoint a receiver and collect rent from them during this 90 day period.

Studies show that 5 out of 4 people have problems with fractions

GlenL (Ohio)
Posts: 5,491

Posted:

Mark try this website for more information on CA foreclosures: http://www.foreclosureradar.com/ca-foreclosure-law

Studies show that 5 out of 4 people have problems with fractions

MarkM19 (Texas)
Posts: 65

Posted:

Thanks Glen I will check both ideas out. It just seems like our PM does not have the time or the desire to chase these options aggressively. That is why I asked the question.

Mark

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Mark,
It appears even if you resolve this issue (you) still have an issue with the PM. Best discuss your concerns in a Board meeting, in the absencee of the PM. If this is just you having the problem, you should not be posting on a public site your concerns. You are a member of the Board and should be very clear when you are being critical of a Board's employee.

MarkM19 (Texas)
Posts: 65

Posted:

Robert, I get your comment and concern. I really do not have a problem with our PM maybe it is the Company that I have issues with. I just find it hard to believe that they do not have a plan for how we can both collect on our bad debt and also foreclose in the quickest way possible. When I was elected to the board they really did not even had a plan for these collections and foreclosure. They had just started sending HO to collections and had many HO that were 5k to 10K behind. I just expected the PMC to guide and help more with the process and offer proven ways to collect and get rid of these type of accounts.

We just wrote off nearly 100K in bad debt like it was nothing. That is money that will never be recovered. Now we are paying collection comapnies to chase 4 and 5 year old debtors. We are starting to see some of these guys pay but it took forever for anyone to have a plan.

The reason I asked the original question is because I know that this blog has many other BODs that are having the same issues. I am hoping for ideas that I can present to my BOD so that we can try to stop the hemoraging.

RogerB (Colorado)
Posts: 5,067

Posted:

Mark, your HOA's collection results are atrocious! It appears that the first problem is the Board. They need to become knowledgeable about collections and the appropriate laws involved. Then they need to get a competent managing agent and establish a collection policy on delinquent accounts. The policies and procedures should include when an account becomes delinquent; late charges and interest in an amount which strongly encourages payment; when to file a lien and a cost which strongly encourages payment prior to filing; when to turn over a delinquent account to an attorney to garnish assets; and if necessary when to initiate foreclosure.

I hope the delinquent accounts are sent monthly letters with a dead line for receipt of payment and a warning about what will happen next if payment is not recieved. Also, for larger balances (over 2 payment periods) give them a chance to establish a payment plan. We believe it is best to encourage the mortgage company to foreclose rather than the HOA; and recommend not making any out-of-pocket payments to a collection agency.

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Mark,
I am pleased that Roger stepped in here. As you can see he is the professional and for my money his advise is solid as a rock. He runs a good ship and expects other PM's to provide the same. I can't add anything to what he says except maybe to caution that it took a long time for your association to get where they are, there is a lot of blame to spread around, not the least being the economic problems, which seem to be headed in the right direction now. This will help, but like all businesses, if you mess with the bull, sometimes you have to deal with the horns. Take it slow, and little bites over time, you are also going to find other things unrelated to this debt collection......it's a big job.

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