Foreclosure in 98664>Question Details

Jan Myers, Real Estate Pro in Vancouver, WA

How does an HOA collect HOA dues and Assessments when a bank has taken over a condo?

Asked by Jan Myers, Vancouver, WA Tue Nov 29, 2011

We have 1 unit that has gone into foreclosure with future dues and assessments. On another condo the bank owns it but has done nothing on it for over a year and owes HOA dues and assessments.

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Jj: I tried to give a longer, more detailed answer a moment ago, but it didn't take. So, I'll try again...
I have dealt with this issue quite a bit as President of an HOA, and as a real estate broker working with foreclosed properties and short sale properties. As I said previously, Washington is NOT a "Super Lien" state, which means that the laws of Washington only give HOA's limited powers to recover 6 months of back dues in these cases. In a bankruptcy all debts are wiped out and if it involves a home that a bank has foreclosed on and taken back and sold at auction then those fees are wiped out. In a short sale the banks will not cover these fees usually, but the law gives the HOA the legal right to recover up to 6 months of back dues. If the HOA has put a lien on the house someone will have to approach the HOA and get them to voluntarily remove the liens, usually for some sort of monetary concession, like the equilivant of 6 months back dues. But, you should check with an attorney because your situation may be different..
1 vote Thank Flag Link Wed Nov 30, 2011
If the bank has taken over a condo through foreclosure. What needs to happen is that the management company for condo board which ever is handling the management of the condominium or the condo association needs to send a letter certified return receipt to the bank and possibly include the loan number which is easily available through public records stating that maintenance and other charges are in a readers. If you do not hear a response East condo will have to sue the lender of that unit in court for the back condo fees which is pretty common and even I myself have had to do for a small condo which I was a part of in Massachusetts. Good luck if you need any further vice please feel free to reach out to have a great day!

Marco Gomez
NY state Associate Broker
Keller Williams Landmark II
0 votes Thank Flag Link Fri Dec 9, 2011
Hi Jj, Each situation is different. The best would be to talk to an attorney for advice. Good luck.
0 votes Thank Flag Link Mon Dec 5, 2011
Jj--Washington is not a "super lien" state, which means that in a foreclosure, or short sale the bank will not pay back HOA dues and they are not required to by law.
0 votes Thank Flag Link Wed Nov 30, 2011
Hi Jj,
All of these answers can apply. Ownership to a property that has an HOA attached always is attached to the property in question. So it's rather tough to really have an exact answer to this without knowing all the details. However, I would talk to the Pres of the HOA, consult an attorney since they may give you some quick free advice on the matter....Always a good idea. Good luck. That's a very good question.

Happy Holidays,
Patricia Bergren
Coldwell Banker United Brokers
0 votes Thank Flag Link Wed Nov 30, 2011
I have had it come up several times and the bank is responsible to pay homeowner dues. I have seen the banks negotiate with Home Owner Associations to reduce the fees owed.
0 votes Thank Flag Link Wed Nov 30, 2011
Title Companies have the duty to collect and pay any money due, in order to change title on a property. Ask any local title company if there are recorded documents that guarantee the payment of HOA Dues, at some point. You probably will find that the HOA has been protected.

Jean Bradford, SFR, CRS, GRI,ABR,CRB
Managing Broker Associate,
John L. Scott
Silverdale, WA
0 votes Thank Flag Link Wed Nov 30, 2011
This is an area where you need to consult a real estate attorney, preferably one that specialize in condos. In specifying that type of real estate attorney, I'm assuming you are part of the association and would like to see those items paid sooner, rather than later. If you're the owner (or past owner) of the two units, then you might instead see a general real estate attorney or one with a debtor-creditor practice.

The answer to your question would depend in part on the age of the condo, because some condos were formed under older Washington statutes. But I do believe for any condo the answer below is correct--that if the bank actually owns the unit at this time, they are responsible for paying the dues, and they will have to be paid before they close any sale of the condo. I did run into one association manager who told me of a bank that was constantly paying their dues one month late, with the late fee which was significant! Banks are just slow at a lot of things.
0 votes Thank Flag Link Wed Nov 30, 2011
If the foreclosure sale has been completed, meaning all the way though transfer of title, then the bank owes the HOA dues and assessments. If not then you would still be responsible.

Bob Patrick
Buy a home after foreclosure expert
(860)392-8353 cell
Movin-On LLC
Revolutionizing the Real Estate and Mortgage Markets
0 votes Thank Flag Link Wed Nov 30, 2011
Well the answer for the one the ban Owens already is that they are responsible for the HOA's ( check with your attorney) and the one that will foreclose the amount past due will be whipped clean and no debt will be paid... It is the home owners responsibility. ( check with attorney).
0 votes Thank Flag Link Tue Nov 29, 2011
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