The Nevada Supreme Court waded Wednesday into the first of what may be multiple cases pitting homeowner associations and their collection agencies against buyers of foreclosed homes.
--->Last year the commission allowed liens for collection costs of up to $1,950.
At issue is how much money buyers can be required to pay to clear HOA liens for dues, fees, fines and collection costs that accumulate against the homes while they sit vacant during the foreclosure process.
During oral arguments before a Supreme Court panel in Las Vegas, an attorney for the state asked the court to find HOA collection agencies and their fees are subject to regulation by the Nevada Financial Institutions Division (FID).
That would represent a victory for buyers of foreclosed homes â€” typically investors.
Thatâ€™s because the FID has already ruled that under state law, HOAs can file liens against foreclosed homes for just the equivalent of nine months of HOA dues.
That would amount to just $450 if HOA dues are $50 per month â€” a sum HOAs and the collection agencies say is woefully inadequate.
The HOAs, dealing with a glut of foreclosed homes during the recession, often spend thousands of dollars on maintenance and repairs for vacant homes and sometimes end up foreclosing on them to recover their costs.
â€œThe publication costs alone are about $500 to conduct a foreclosure,â€ Patrick Reilly, a Las Vegas attorney with the firm Holland & Hart LLP and representing three collection agencies, told the court Wednesday.
The collection agencies say HOA fees can only be regulated by another state agency, the Nevada Real Estate Division.
The state Commission for Common-Interest Communities and Condominium Hotels, which is part of the Real Estate Division, has been friendlier than the FID to HOAs.
DAVID COOPER Investor with Buyers Agent License at Since 1917 Realty 702-499-7037
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