Are HOAs Taking Advantage of Mortgage Servicers?

first_imgHome / Commentary / Are HOAs Taking Advantage of Mortgage Servicers? While Homeowner Association (HOA) liens for unpaid assessments typically have priority over second mortgages and other junior liens (because the HOA liens may “relate back to” the HOAs’ previously-recorded declarations), first mortgages receive special treatment in various states, such as Minnesota. Despite that special treatment, HOAs often demand payment of substantial bills by lenders foreclosing first mortgages. In addition to the regular monthly dues, the HOA bills may come riddled with line items for special assessments, attorneys’ fees, late charges, interest, and more that may not be the responsibility of the lender to pay. When the bills threaten to delay sale closings, lenders must quickly decide whether to pay the bills or delay matters, potentially losing sales, to challenge the HOA’s invoices. As an example, Minnesota law generally provides a clear outline of what charges must be paid by foreclosing lenders. The foreclosing lender for a first mortgage is only required to initially pay the “unpaid assessments for common expenses levied which ‘became due,’ without acceleration, during the six months immediately preceding the end of the owner’s period of redemption.” The lender is not responsible for late charges and attorneys’ fees assessed during or prior to this six-month look-back period, because the Minnesota HOA statute specifically omits these amounts in the list of allowed charges.Unfortunately, unscrupulous or ill-informed HOAs may add all of the unpaid association dues, late charges, and attorneys’ fees to bills regardless of their timing. Often, these unlawful charges are paid by lenders who are too busy to challenge every line item. When an HOA bill looks suspect, a lender should determine what assessments are legally allowable before making payment. It may be more cost effective for a lender to hire an attorney for an invoice review and challenge, than to repeatedly pay substantial sums that are avoidable.Of course, once the first mortgage holder completes foreclosure and that lender becomes the outright owner of the HOA property, that party must timely pay all HOA dues and assessments going forward. If those assessments become delinquent, the lender or its successor would become subject to collection costs, including attorneys’ fees, similar to any other unit owner, as well as foreclosure by the HOA. As soon as the redemption period expires in redemption states, or the lender becomes the outright owner of the property through other means, the lender should ensure the HOA is contacted and that the HOA account is kept current.Certain associations may also strategically time when they levy special assessments to try to get lenders on the hook for those expenses.  For example, consider the instance when an abandoned, mortgaged HOA unit has a fire in one year causing the HOA to incur costs for repairing that unit, but the lender does not foreclose its mortgage until the following year.  The HOA may delay levying the repair costs until after the mortgage foreclosure sale. Since the HOA lien statute may not define when those repair costs actually “became due,” it may be unclear without court intervention whether the lender is truly obligated to pay those assessments.A foreclosing lender who claims a first mortgage position should also ensure that property records are consistent with that senior lien claim as early as possible.  This is particularly true in non-judicial foreclosure states, where senior liens can potentially foreclose and wipe out junior liens without notice.  If an HOA forecloses its own lien and has a sheriff’s sale, all junior mortgage liens that fail to redeem from the HOA’s foreclosure, where applicable, will become wiped out.  If there is a previous mortgage that was paid off by the intended first mortgage, but not properly satisfied or released of record, the intended first mortgage could be deemed a second mortgage and wiped out by an HOA lien foreclosure. This same result could also occur when intended first and second mortgages are recorded in the wrong order. A Minnesota court recently decided that the priority order of liens may be set as soon as the HOA’s sheriff’s sale is completed, preventing the lender from establishing priority later through a judicial action.  Mortgage holders should record Request for Notice documents for prior lien foreclosures wherever applicable. In certain states such as Minnesota, these Request for Notice documents must be recorded separately from the mortgage. Importantly, mortgage holders should also diligently review any foreclosure notices immediately upon receipt—as well as related property records.  Lenders should never assume they hold first mortgages until after they have reviewed property records confirming that status.If a lender does successfully challenge an HOA through litigation, it is possible in certain jurisdictions that the lender can recover attorneys’ fees and litigation costs.  In various jurisdictions, a court may award reasonable attorneys’ fees and litigation costs to the “prevailing party.” Moreover, if the lender is able to establish that the HOA willfully failed to comply with the HOA statutes, the court may award punitive damages as well in certain jurisdictions, such as Minnesota.In sum, lenders need to be wary of HOA liens and their foreclosures, and act quickly to spot and resolve issues as soon as they arise. Otherwise, lenders may end up paying significant and unnecessary costs to HOAs, or worse, lose their liens entirely to HOA lien foreclosures. Kevin Dobie is a Partner and handles litigation and other matters for mortgage servicers at the firm. Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Sign up for DS News Daily Data Provider Black Knight to Acquire Top of Mind 2 days ago Tagged with: HOA Mortgage Servicers Brian Liebo is the Managing Partner of Minnesota Mortgage Default Services Law firm, Usset, Weingarden & Liebo PLLP and is an MSBA Board Certified Real Property Specialist. Are HOAs Taking Advantage of Mortgage Servicers? The Week Ahead: Nearing the Forbearance Exit 2 days ago HOA Mortgage Servicers 2017-04-07 Brian H. Liebo Related Articles About Author: Brian H. Liebo Governmental Measures Target Expanded Access to Affordable Housing 2 days agocenter_img Share Save Demand Propels Home Prices Upward 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Demand Propels Home Prices Upward 2 days ago in Commentary, Daily Dose, Featured Previous: Victory and Vindication for Castle Law Group in Landmark Decision Next: Most Improved Markets in Portland and Charlotte April 7, 2017 11,090 Views Data Provider Black Knight to Acquire Top of Mind 2 days ago The Best Markets For Residential Property Investors 2 days ago About Author: Kevin Dobie The Best Markets For Residential Property Investors 2 days ago  Print This Post Subscribelast_img read more

Greg Wathen Selected As North America’s Top 50 Economic Developers For 2016

first_imgGreg Wathen Selected As North America’s Top 50 Economic Developers For 2016Consultant Connect, a consulting agency designed to bridge the gap between economic developers and site consultants, announces its 2016 list of North America’s Top 50 Economic Developers which includes Greg Wathen, President & CEO of the Economic Development Coalition of Southwest Indiana. The 6economic development professionals selected for this list were nominated by their colleagues in both the economic development industry and the site consultant community for excellent practices, innovation and success in building the communities they serve.“This annual list recognizing North America’s Top 50 Economic Developers is designed to acknowledge the hard work of the top leaders in this field and elevate the conversation around economic development and job creation,” said Ron Kitchens, managing partner of Consultant Connect. “Each of the leaders represented on this year’s list are beyond deserving of this recognition for their efforts in building our communities brick by brick and job by job.”This makes the second year in a row that Wathen has been selected. Since March of 2007, Wathen has lead the Economic Development Coalition of Southwest Indiana from a fledgling public-private partnership to the national brand of Indiana’s Great Southwest. The Coalition promotes the region’s assets to a global marketplace for business attraction and retention helping garner over $2.8 billion in investment creating 3,568 jobs; and, has helped the region gain approximately $74 million in state and federal grants for capacity building.Most recently Wathen successfully spearheaded the state-wide effort for the Evansville region to be named one of Indiana’s first Regional Cities, a designation that will receive $42 million for talent attracting projects.Each of the top 50 economic developers will be featured on the weekly podcast, From The Ground Up: North America’s Top 50 Economic Developers where Wathen and other industry leaders will share their expertise in the field of economic development and leadership insights they’ve learned along the way. The podcast is scheduled to air March 31 at “It is an honor to be named to this prestigious list, but as any good economic developer knows, it takes many hands to change the landscape of communities,” said Greg Wathen, President & CEO of the Economic Development Coalition of Southwest Indiana. “Indiana’s Great Southwest is on the cusp of transformative growth and it’s due to a common shared vision.”FOOTNOTES: Our next “will be posted on this coming Wednesday ?Please take time and read our newest feature article entitled “HOT JOBS”. Jobs posted in this section are from Evansville proper.If you would like to advertise in the CCO please contact us City-County [email protected] “Readers Poll” question is: Do you feel that the Evansville Brownfields Corp should provide the general public with annual audits and copies of their meeting agenda?Copyright 2015 City County Observer. All rights reserved. This material may not be published, broadcast, rewritten or redistributedFacebookTwitterCopy LinkEmailSharelast_img read more

1,500 delegates to join WVPRISAA today

first_imgROXAS City – Around 1,500 delegate-athletes, coachesand officials from various private institutions in the region will slug it allout at the start of the Western Visayas Private Schools’ Athletic Association(WVPRISAA) Meet today.  The winners of the sporting and cultural events from different private institutions will represent Western Visayas in the National PRISAA on April 18 to 24 in Tuguegarao, Cagayan Valley. The CAPRISA member schools, Capiz Commercial School, Filamer Christian University, Hercor College, and Colegio de la Purisima Concepcion,  will serve as venue of the event and the billeting of the delegates. The 2020 WVPRISAA will host over 20 sports and cultural eventsincluding  athletics,badminton, basketball, beach volleyball, billiard, chess, dance sports,football, karate-do, lawn tennis, “mutya sang WVPRISAA,” oration, prisayawan,sepak takraw, swimming, table tennis, taekwondo, vocal solo, vocal duet, andvolleyball.    Last year, WVPRISAA emerged as the overall champion of the 63rd National PRISAA Games in Davao – with 212 gold, 146 silver and 97 bronze medals.        Rt. Rev. Msgr. Cyril Villareal, president of the CapizPrivate Schools’ Association (CAPRISA), perceives the weeklong competition asan “exciting one” with the support of the local government.  Delegates of the Western Institute of Technology men’s football team are set to represent Iloilo in the 2020 Western Visayas Private Schools Athletic Association meet in Roxas City, Capiz starting Feb. 1. ROBERT BLANCE “This event will be more memorable because of thesupport extended by the Capiz provincial and Roxas City government, ensuringthe security and safety of the delegates and at the same time, extending theCapiznon warmth and hospitality,” Villareal said.  Founded on Feb. 17, 1953, the PRISAA commits to bring exposure andcredibility among private schools across the country./PNlast_img read more

Tori Bowie wins gold with sensational run in 100m final

first_imgAmerican Tori Bowie produced a sensational run in the final of the 100m to win gold narrowly beating Marie-Josee Ta Lou.Bowie looked in good form during the semi-finals and although Ta Lou got off to the better start she came back superbly to win in a time of 10.85s.Watch the World Athletics Championships LIVE on EurosportThe finish couldn’t have been closer but a fantastic dip on the line gave Bowie the victory over the impressive Ta Lou who will still be thrilled with her silver medal.”I had no idea [I’d won]. All I knew is I left everything on the line,” said Bowie after the race.he shock of the night was that Olympic champion Elaine Thompson was nowhere as she started poorly and simply couldn’t recover. Just like compatriot Usain Bolt last night she couldn’t live up to her pre-race billing.last_img read more