In many respects an association foreclosure mirrors a bank foreclosure, with some minor differences.
Once an account is delinquent, the association is permitted under Florida Statutes to place a lien on the subject property for nonpayment of assessments.
Prior to recording this lien, the association is required to send the offending homeowner a Notice of Intent to Lien and to provide a period of time with which to bring the account current (30 days for a condominium association, 45 days for a homeowners’ association).
If the account is not brought current during this time period, the association is permitted to record its lien and institute a foreclosure action in the subject property and against the offending homeowner.
Prior to filing the lawsuit, however, the association is required to offer the offending homeowner one last chance to bring the account current.
Because of Florida’s boom in development during the 1990s and early 2000s, many properties are included in planned unit developments, more commonly known as homeowners’ and condominium associations.
If a property is located within one of these developments, activities conducted on and uses of the particular property are governed by the association charged with overseeing the day-to-day operations of the development.
Although we tend only to notice the activities of the association as they relate to aesthetic matters (landscaping, trash disposal, pool maintenance, etc.), much of the association’s duties relate to community finances and enforcement of the association’s governing documents.
While the legal principles involving associations is vast, this blog will focus on one small aspect of the association puzzle: association foreclosures for nonpayment of assessments.
How many times have you looked around your home and thought, “Wow, that stain on the ceiling is huge. I need to fix that water leak.”
How about, “I’m so glad those termites haven’t come back.” Or, have you moved that potted plant to cover the water stain that seeped up through the hardwood floor?
While these are things we’ve probably all done or thought at one point or another, these instances can have big effects if not properly disclosed during the sale of your home.
Even something as minuscule as a bump in the floor can signify a larger structural issue and cause you a massive headache months or years after the sale of your property. Sometimes there can be confusion about which defects warrant disclosure.
Real estate professionals are expected to have a lot of information under their belts (and in their heads) to help their clients.
There is there so much new information coming out all the time and keeping that all in our straight can be exhausting and confusing.
Sometimes the things we know best get shoved into that corner of our brains where I’m sure all the unmatched socks go – which is why it is helpful to have a quick refresher on the things we talk to our clients about every day. (Because they often ask, and we don’t want to admit we’ve forgotten!)
Three basic instruments are involved in most financed residential real estate transactions, and knowing which is which and how they relate to each will be very valuable knowledge to provide to your clients.