Posted on Wednesday, January 5, 2011
I am also a Pres. of a condo assoc. Does this mean that property's that have been vacant for 2 years without paying main. will sit there for another couple of years with no one paying? The atty.'s have been sitting on these properties that the banks have given them to foreclose on. I could tell you some real stories. It's not just the banks, it's the atty.'s for the banks. Does Fannie, Freddie, and the banks realize how this will put HOA's and Condo's in a situation that can never recover from! We need more news coverage on this. I would gladly share stories with you.
Dear Mary - Unfortunately folks in condos or communities with HOAs are being hard hit. And as Im sure yo uknow the Florida Statutes were amended not too long ago to limit lender liabiity for assessements. The other issue as you mentioned is lenders holding off on foreclosure to avoid paying fees and ownership responsibilities. Fron the bank's view you can understand that business decision - theyve got hundreds sometimes thousands of these units and this is more than they bargained for too.
One tool Ive used it, as soon as it appears there will be a foreclosure, to approach the bank and offer to allow them to buy out the associations lien. Its often more cost effective for them to buy that and foreclose it to get ownership of the unit than to try foreclosing their own mortgage since the mortgage foreclosure will typically allow borrowers and their lawyers more counter claims and defenses and is usually just a much longer costlier process (even without robo signing issues).
Your board may also want to look at proventative amendments to avoid or discourage unit owners from going into forclosure.
Unfortunately theres no perfect solution and just about every association I talk to is facing this same challange.
All my best, Shari