Property Q&A in Phoenix>Question Details

Blueclue, Home Owner in Phoenix, AZ

HOA wants to pursue remaining balance after short sale that already happened 4 months ago, is this legal to go after me for a house i no longer own?

Asked by Blueclue, Phoenix, AZ Thu Mar 1, 2012

I got the shortsale approval, agent negotiated w/ HOA for unpaid dues, they settled for the amount that covered by the bank. Now i got a letter (4 months later) from an attorney firm representing the HOA stating that they will pursue me for the rest of the balance. I'm shocked and appalled and need some advices on how to deal with them. Thanks

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Answers

6
Hi Blueclue,

If the amount paid by your lender as part of the short sale covered your entire balance owed to the HOA, then I would provide the attorney with the HUD statement showing the balance paid to your HOA and ask for the account to be closed. However, if the amount paid by your lender was INSUFFICIENT to cover your past-due HOA balance, then yes, the HOA can pursue you for the remaining balance even after the sale. Monies owed the HOA follow whoever owned the property at the time the fees were due.

Did you ever confirm for yourself whether the amounts paid by your lender were sufficient to wipe out your negative HOA balance?
1 vote Thank Flag Link Thu Mar 1, 2012
Blueclue,

As agents we can absolutely answer this question because, as agents, we have experience in this regard. To some of the other agents - simply sharing our knowledge and experience does not equate to legal advice. So please take the time to actually answer Blueclue's questions instead of giving him non-answers.

If your HOA agreed to discount your payoff and not hold you responsible for any remaining balance, you should have received something in writing from that HOA. Saying that your agent negotiated this on your behalf is not sufficient - did you get the HOA's commitment in writing? If not, then I definitely urge you to get some legal advice. It's quite possible the HOA accepted less than what was owed in order to release the lien, however that does not release your personal obligation to pay the remaining balance unless you have a written release from the HOA.

Also, review your closing documents and everything that you signed - there may be a release included from the HOA which you can provide to their attorney.
0 votes Thank Flag Link Fri Mar 2, 2012
Hi Blueclue,

Best advice has already been given which is talk to an attorney. As agents we can not give legal advice, but does not mean we can't share what we know in regards to real estate.

HOA dues are normally a personal liability and a foreclosure or short sale probably will not wipe out those obligations. HOA has a right to put a lien on the property for unpaid dues. Therefore, your agent would have negotiated with the HOA to release the property so that it can be sold. The title company would also need this in order to insure title. As you stated, the HOA accepted less than owed to release the lien. They may not have agreed to release you from all amounts due. Review the paper work and see what the HOA agreed to. If they only agreed to release the lien, you may still be on the hook.
0 votes Thank Flag Link Fri Mar 2, 2012
Thank you all!
Well, I understand i will need to contact an attorney eventually. My purpose to post this question is to see if anyone (agent/attorney/broker) have seen this situation before whereas HOA and its attorney accepted the offer (at a lesser amount) to release the lien of my property for a shortsale then turn around and pursue the old owner for the remaining balance after 4 months later?
Not only it is unethical but isn't it against the contract or settlement that was drawn between buyer/lender/seller/HOA?
0 votes Thank Flag Link Thu Mar 1, 2012
Scottsdale Law Group, Kristi Collins, 480-478-0709

Bill.
0 votes Thank Flag Link Thu Mar 1, 2012
Hi, Blue ... you need to talk to a real estate attorney as quickly as you can; we're not in a position to provide legal advice here, though I have no doubt some will try.

If you need a name, let me know.

Thanks!
0 votes Thank Flag Link Thu Mar 1, 2012
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