How to Defend Against an HOA Foreclosure Part 1
Your neighborhood homeowners’ association (HOA) is responsible for ensuring that life in your neighborhood matches the picturesque depictions in the pamphlets distributed to prospective buyers at your leasing office. For the most part, a hardworking HOA can help iron out some of the wrinkles in a neighborhood and improve the quality of life for the residents living there, but there are also situations where an HOA can become an antagonistic presence that tries to forcibly remove you from your home.
If you fail to pay your HOA fees or assessments, the HOA could foreclose your home. Luckily, I buy houses in Raleigh, NC that are being targeted for foreclosure by aggressive HOAs. In part one of this two-part series, we will prick holes in common HOA strategies for foreclosing on your home and weigh some of the positives and negatives for staying in your home or escaping with a quick sale.
Overstated Charges and Faulty Accounting
If you can prove the HOA made errors when calculating your assessment liens, and that these assessments are invalid, you can use this information to help stay in your home. HOAs are responsible for keeping records of payments and debts. If they are unable to produce records of assessments, late fees, interest, fines, and costs as outlined in the covenants, conditions, and restrictions (CC&Rs), they can do little to legally force you to pay.
Failure to Observe the Assessment Lien Foreclosure Statutes
If the HOA tries to foreclose on your home without adhering to the state statutory requirements, the foreclosure cannot reasonably be enforced and must be dismissed. According to Fla. Stat. Ann. § 720.3085(5), the HOA cannot legally institute a foreclosure until 45 days after the homeowner has been served with a notice depicting the association’s intent to foreclose and collect the unpaid amount.
The HOA must assess reasonable fines, interest, late fees, management fees, and attorneys’ fees when foreclosing a resident’s home. Therefore, if the HOA forecloses due to $500 in unpaid association fees, but the penalties and costs to pursue this debt bring the total to $4,000, a judge can deem the charges “unreasonable” and dismiss the case.
When you’re pitted against a feisty HOA that refuses to listen to you and opts to forcefully foreclose your home, you need to examine your options and decide whether it’s time to stay or time to go. People who buy homes in Raleigh, NC are willing to pay cash for your home today to help you get a reprieve from dealing with unsavory HOAs, but if you still believe you have a case, we will explore more ways to defend your home from an HOA foreclosure in part two.
Disclaimer: This website is not a substitute for legal advice. If you have a serious legal, tax, or other issue requiring professional advice, please consult with an attorney or CPA.
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