Jane, Other/Just Looking in Rochester Hills, MI

If you have a foreclosure on your property can the condo association come after you for their fee's? Can the city come after you for property?

Asked by Jane, Rochester Hills, MI Sun Feb 28, 2010

taxes? Can they garnish my pension or take my Ira's or 401K monies? I have a mortage of $114,000 on a Condo that is now worth $75,000 (if I find a buyer). I am thinking of walking away from this property. There are many people involved in this. Condo Association ($335 mth), Property Tax (Approx $1500 year) & Mortgage. Can any of them take my savings or get into my pension? Please advise.

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0 votes Thank Flag Link Mon Mar 1, 2010
Hi Jane,
If you decide to move forward with a short sale, the bank will usually py the property taxes. It is rare the banks will pay any past due HOA fees. Your agent can negotiate with the buyer and see if they can come up with some money to pay the HOA. If you decide to walk away, the HOA can come after you personally to collect their money. I had a seller in your exact situation and the HOA ended up taking about 50% of what was owed. You do want to get something in writing that says they will accept the lesser amount as payment in full just so they don't try and collect the difference later on.
0 votes Thank Flag Link Sun Feb 28, 2010
I have been all too familiar with properties sold (condos) and association fees. No they cannot touch anything that you own except the property. All said and done they have first lien position, period. Doesn't matter if there is a mortgage or not. I am told that they need to contact your mortgage company should they start foreclosure proceedings. You don't make the association payments they can take title to the condo and not be obligated to the first mortgage holder. So loosing the condo through foreclosure does not relieve the mortgage company from bringing the association fees current. In fact the majority of them are current.
As an example: If the association fees are not paid they can ultimately foreclose on the property and gain possession. If there is a mortgage there is contact between the association and the mortgage company. So can they take your pension? No, I have never heard of that happening. I have been selling real estate for the past 33+ years and I am positive I have never herd of anything like that. - Ed
0 votes Thank Flag Link Sun Feb 28, 2010
Hi Jane,

You really need to sit down with your attorney or your financial expert and discuss these questions and whether or not foreclosure is a good idea for you. But also know that another alternative is a short-sale which can be a pretty simple and painless for you. It can also look a lot better on your credit report and includes the pay-off of association dues & property taxes. Look at all of your options w/ the proper professional before you make any big leaps!

Jay M. Jones, Realtor
Max Broock
Web Reference: http://www.MyRealtorJay.com
0 votes Thank Flag Link Sun Feb 28, 2010
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