Since the housing crisis began and more homes become vacant, HOAs have become increasingly aggressive in seeking to recover their fees. We have now seen HOAs filing lawsuits over debts as small as $1,200. Once a lawsuit is filed, attorney’s fees and costs are tacked on, which can easily exceed $1,000. It is wise to settle HOA debts before a lawsuit is filed, however, it is not always wise to agree to every fee the HOA tries to place on you. It can pay to have an experienced firm like The Butler Law Office review your statements and compare the charges with the rules that grant the HOA their authority. Occasionally, homeowners are wrongfully charged fees by mistake or by neglect.
As long as title to the house is in your name, you are liable for HOA assessments, even if you vacated the house and are anticipating foreclosure. Most HOAs have power to collect personally from the homeowners, so they can sue you even after you lose the house to foreclosure. This power is usually granted through the Covenants, Conditions, and Restrictions (CC&Rs) which apply to the property no matter who owns it. Every home purchaser should be given a copy of the CC&Rs when they purchase the home. Although the HOA may have you personally on the hook for the debt, once the house is no longer in your name, it becomes an unsecured debt. Unsecured debts are easily discharged in bankruptcy, so HOAs are usually willing to settle if they believe the borrower may file bankruptcy. These debts often settle for 50% of the amount owed, or less, if you have an experienced negotiator like The Butler Law Office. This may hold true whether you have lost the home to foreclosure or whether you plan to continue owning the home.
The Butler Law Office can also resolve HOA rules disputes. Often the CC&Rs use complex legal terms that are difficult for homeowners to understand. Our knowledge and experience helps us to interpret the rules governing your property and inform you of your rights and responsibilities as a homeowner. Additionally, we can advise homeowners as to whether they have a legal claim against their HOA and we can file a lawsuit if necessary.
In addition to settling this type of debt, The Butler Law Office can help reduce your expenses by negotiating a Loan Modification of your home mortgage. We can also evaluate all of the legal issues surrounding the real estate that you own or that you may have recently lost to foreclosure.
The Butler Law Office has over thirty three years of experience and can help you make a decision that will be best for you!