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In almost all cases, HOA leins are subordinate to the first mortgage.
Your HOA may want to buy a few hours of HOA attorney time to understand its rights and exposures in your state.
Good answer however there is one thing that needs to be added; in today's world generally when people stop paying HOA dues they also have stopped paying their mortgage. The banks are sometimes spending YEARS going to foreclosure, the HOA must look at each case and make a decision if it might be advantageous to do a foreclosure and rent out the property to recoup some of the back HOA fees.
As MAM mentioned, one must look at the laws of each specific state and I would strongly recommend consulting an attorney. Our HOA has foreclosed on a particular unit and now rented it out for almost two years as the bank holding the mortgage has failed to act. A couple of others we have decided not to proceed as they left in disrepair and cost too much to put back into rental condition.
Yes. You don't need an attorney to file a lien. The paperwork is at the county courthouse. Anyone can file one.
FalconheadWest are you an attorney licensed in SC or anywhere else?
Your statement isn't even correct in this state. In fact preparing and filing such a lien on behalf of the HOA corporation is the practice of law in Texas and HOA management companies have been engaged in the unauthorized practice of law for many years.
The situation was so bad here that the legislature created a new statute expressly directed towards HOA liens - not to change the law but rather to provide notice to HOA management companies that they were engaging in the unauthorized practice of law.
It would be entertaining to watch an HOA board member be charged and prosecuted for the unauthorized practice of law - especially for the owner targeted by the lien.
FalconheadWest are you an attorney licensed in SC or anywhere else?
Your statement isn't even correct in this state. In fact preparing and filing such a lien on behalf of the HOA corporation is the practice of law in Texas and HOA management companies have been engaged in the unauthorized practice of law for many years.
The situation was so bad here that the legislature created a new statute expressly directed towards HOA liens - not to change the law but rather to provide notice to HOA management companies that they were engaging in the unauthorized practice of law.
It would be entertaining to watch an HOA board member be charged and prosecuted for the unauthorized practice of law - especially for the owner targeted by the lien.
IC
I did specifically ask about the state of SC, not the state of Texas.
The country recently sent the latest notable Texan back to Texas....can we say welcome home Governor Perry......LOL
Good answer however there is one thing that needs to be added; in today's world generally when people stop paying HOA dues they also have stopped paying their mortgage. The banks are sometimes spending YEARS going to foreclosure, the HOA must look at each case and make a decision if it might be advantageous to do a foreclosure and rent out the property to recoup some of the back HOA fees. As MAM mentioned, one must look at the laws of each specific state and I would strongly recommend consulting an attorney. Our HOA has foreclosed on a particular unit and now rented it out for almost two years as the bank holding the mortgage has failed to act. A couple of others we have decided not to proceed as they left in disrepair and cost too much to put back into rental condition.
In my state, an HOA can obtain a judgment to evict the owners and then typically the HOA rents out the place to cover past due and current assessments. I am aware of several condo associations with substantial assessments who are doing this to protect the interests of all homeowner members.
I have read about the occasional HOA foreclosing which makes no sense to me unless there is equity in the place. Speculation on my part, that the HOA would be on the hook for the first mortgage if there was no equity.
In my state, an HOA can obtain a judgment to evict the owners and then typically the HOA rents out the place to cover past due and current assessments. I am aware of several condo associations with substantial assessments who are doing this to protect the interests of all homeowner members.
I have read about the occasional HOA foreclosing which makes no sense to me unless there is equity in the place. Speculation on my part, that the HOA would be on the hook for the first mortgage if there was no equity.
We had a local HOA take a house where the dues were in arrears, and no equity.
The neighborhood was then stuck with the debt/payment, maintenance, dues, on a home they could not sell, and it splattered on the news.
Last edited by MikeJaquish; 01-20-2012 at 08:39 PM..
I did specifically ask about the state of SC, not the state of Texas.
The country recently sent the latest notable Texan back to Texas....can we say welcome home Governor Perry......LOL
I know you were asking about SC. That's why I rebutted FalconheadWest's remarks - because they weren't even true in Texas where FW apparently hailed from.
We are an HOA with 120 patio homes with literally no amenities so not a complex logistic nor budget situation. Our budget is sound but as with many HOA's we have few no pays (foreclosure, in estate due to a death, etc.) and some late pays. We have no interest nor desire to foreclose, own units, rent units, etc. We are simply exploring how we might "politely encourage" some late payers to get caught up.
We are an HOA that says let us see how we can make that happen versus one that says let us see how we can deny that.
Thanks
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