Foreclosure in Aurora>Question Details

Charka, Other/Just Looking in Aurora, CO

What can HOA do in small claims court on foreclosed home??

Asked by Charka, Aurora, CO Mon Dec 28, 2009

I moved out of my condo in August 2008. The property foreclosed in March 2009. I did not pay HOA dues during this time and now HOA has taken me to small claims to recoup $930. What will happen if I don't pay?? Can they do anything since the property is not mine anymore? I don't think I should have to pay since I was not living there or using any of the resources for which my monthly dues were responsible. Please advise if you can!

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Keith Manson- Metro Milwaukee Wisconsin’s answer
I think you may have a significant issue. Colorado is in a super lien state and thus if the condo association gets a judgement awarded in a small claims court they will be able to collect as any other judgement. The condo association in your state have more power than most other states.

Please review the article about super liTypically, mortgage servicers are in a unique position of power when it comes to asserting lien position as long as the proper title work and front-end activity takes place. With the exception of tax liens, virtually all other lien interests secured after the recordation of the mortgage lien are inferior to the mortgage lien. Laws enacted in 16 states and the District of Columbia spoil the servicers position of power, as community association liens are granted senior lien positions under certain circumstances involving non-payment of dues, these liens are called “Super Liens”. For all general purposes, these Community Associations have been able to affirm that they act as mini-government bodies in the day to day management of their properties and the association dues, are in fact a form of taxation.

The super- lien statutes vary from state to state, but can be categorized into three main groups segmented by statute type.

1) Expansive Super-Lien Statutes
Alabama, Alaska, Colorado, Connecticut, Minnesota, Nevada

Statutes in these states are based on section 3-116 of the Uniform Common Interest Ownership Act (CIOA). Section (b) of the statute specifically states that, with some limited exceptions, community association liens for non-payment of dues are “prior to all other liens and encumbrances on a unit.” The lien amounts are typically (see table below) limited to six months of delinquent dues. The provision allows for the speedy foreclosure of the unit without the need for further notification or notice to borrower, but with reasonable notice given to all lien holders whose interest is affected.
State Amount of Lien Special Circumstances
AL Six months prior dues • Applies to first mortgage loans only
• Atty fees and costs included in judgment amount
AK Six months prior dues • Applies to first mortgage loans only
• Atty fees and costs not included in judgment amount but are typically collected in the foreclosure.
CO Six months prior dues • Applies to condos only
• Applies only to assessments due after 6/30/1992
CT Six months prior dues plus HOA special assessments • Applies to first and second mortgage loans
• Atty fees and costs are recoverable through foreclosure
MN Six months prior dues • Applies only to first mortgages recorded after June 1, 1994.
NV Six months prior dues • Applies to first mortgage loans only
en states below:

Keith Manson
First Weber Group
Certifed Distressed Property Expert
Metro Milwaukee
1 vote Thank Flag Link Tue Dec 29, 2009
Thanks to all for the answers and additional resources. I will be contacting an attorney to see what can be done to avoid paying this joke of an HOA.

0 votes Thank Flag Link Mon Jan 4, 2010
Keith, excellant response. You deserve a 'pokey' for that.

Charka, the consequence for you based on your legal and enconomic situation must be discussed with an attorney. Although information may be shared, guidance relevant to your situation and the conseqences to you are the responsibilities of your attorney. Keith has however, provided excellant information from which to start your discussion with an attorney. Many attorneys will allow a complimentry review of your legal status and recommend the best action. Be sure to ask, "Will this problem go away when (if) this property sells?" Let us know the outcome.
0 votes Thank Flag Link Tue Dec 29, 2009
This is a Legal Question that us Realtors can and should not answer. We are not allowed to give Legal Advice. Please consult a Real Estate Lawyer.
0 votes Thank Flag Link Tue Dec 29, 2009
Interesting question. I'm in California so the rules from state to state vary. Here in California the HOA lien the property just like a mortgage and property taxes. So when a property changes hand the HOA should be contacted and those liens cleared along with other title issues. But when a property is foreclosed often times a buyer does not get a clean title and unfortunately the new owner assumes any liens tied to the property.

You will need to review the HOA documents for the property and see what language is in it and if necessary contact an attorney.

Good luck.
Web Reference:
0 votes Thank Flag Link Mon Dec 28, 2009
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