HOA’s facing Trouble because of Innumerable Owners being Foreclosed upon
The HOA’s or the homeowner’s associations contend that sometimes they have to take tough decisions so as to guard their interests. Sometimes the unit owner is sick or has been laid off from job – that is a different matter. But it is quite another matter when unit owners have not made monthly payments to the associations but has fixed marble kitchen counter tops.
John McCosh of South Prado Unit Owners Association said that it is not fair that in many instances the owners give the last priority to association fees. He is the secretary of the association managing a condo complex comprising of 23 units in Ansley Park.
In the beginning of the current year Prado Unit Owners Association took the stand of not making any exception while dealing with many owners who had become delinquent. The dues of one of them had added up to 10% of the budget of the association. He is now a fugitive on the run across the world.
In metro Atlanta there are about 10,000 or nearly 15,000 communities managed by associations. Nearly a fifth of the people of USA live in these communities. This number substantially increased during the past two decades as more owners sought to live in big communities with common amenities covering many aspects of living.
In due course it became the duty of these associations to see to the maintenance of roads, swimming pools, the landscaping, water supply bills, insurance coverage and other major improvements. Previously these were once handled by the cities as well as the counties. To operate all these functions the HOA’s depend on the fees paid by the community owners.
When the housing crisis struck and recession stalked in, many of the associations were compelled to either reduce or increase dues and make various alterations including concessions as to keep running. They also witnessed with dismay banks foreclosed on innumerable units.
Attorney Kathy Dorough of Decatur said that 75% of her work dealt with HOA collections and fees. Her firm is now handling 2,500 pending lawsuits. She said, “Our members have been very negatively impacted by the economic situation”. She is the president of Community Associations Institute – its Georgia sector and bemoaned, “Our members have been negatively impacted by the economic situation”.
Many lawyers representing the associations say that some associations numbering few dozens have failed because of the defaulting homeowners. Currently it is not uncommon to see nearly two thirds of the unit owners not being regular in their association dues.
A Home Owners Association should not be allowed to foreclose. The HOA should sue in court and register a lien if successful. This debt should be treated like any other personal debt. You owe on your credit card. Can they foreclose? No.
[...] the right to the lender that if the money is not paid back to him or her on time, he or she can foreclose the property against which the loan was issued. These foreclosures can be of many types. In a [...]