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StumbleInvestors’ suit over HOA fees headed to mediation
Monday, Aug. 16, 2010 | 5:24 p.m.
A lawsuit filed by investors claiming homeowners associations are bilking them out of thousands of dollars in collection fees when they buy foreclosed homes is headed to mediation.
Last week, District Judge Kathleen Delaney dismissed a lawsuit against homeowners associations just as District Judge Jennifer Togliatti did in May regarding the investors' action against collection agencies hired by the association.
The dismissal of the cases doesn’t mean the cases are completed. The judges ruled that state law requires such cases be mediated first. If that fails, the lawsuits can be refiled in district court, and investors’ attorney James Adams of the Adams Law Group said that is likely to happen.
The investors claim the homeowners associations’ collection agencies are charging them more than state law allows for assessments, fines and interest and other costs that accumulate when the previous homeowners stopped paying their dues. They argue they shouldn’t pay more than nine months of assessments, and not thousands in fees charged by the collection companies.
Collection companies maintain the fees are necessary to cover their costs and homeowners associations have supported steps to recover past due money needed to balance association budgets.
The state Common Interest Communities and Condominium Hotels Commission is considering a cap limiting collection companies to charging $1,950. A decision is expected by the end of the year.
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What crap. These "investors" purposely do not foreclose homes for 2 years so they can reduce inventory and raise prices and expect the Homeowner's to pay their share of the HOA. I hope they lose their shirts.
I think the HOA's should go after the previous owners and banks for their money and stop harrassing the people who have just purchased the homes. The new owner's, whether they're investors or not, should not be liable for past monies. Period. Thank god I don't live in one of these HOA neighborhoods. These people are nothing but Nazi's.
I agree. I am on my HOA board and people don't understand what we have to deal with. It causes the HOA dues to go up because people don't pay their HOA dues. Some people have never paid dues, over 5 years now and are about to be forclosed on. And "they" want to pay only 9 months back!! What about the past 4 years that were nevered paid?? When you don't pay your phone, electric, gas, water bill, they turn off your service. What service can the HOA shut off??!! NONE!! So that is why we need to charge fees to collect money due. Must be nice to be an investor that has all this extra cash to buy many houses!! What about the people that can not afford 1 house!! What is maybe $2000 on top of the 100K they are paying for the foreclosed house!!
Hey dlmvegas, we try to go after them but they won't pay their dues in the first place!!! So how can we go after them once they sell/leave their house and move out of state??! We have HOA to keep the value of our houses up and keep crime down. Look at older sections of LV or NLV, look at the crime and how crappy the houses look. I purchased my house being a REO and did not mind paying the dues, we worked it out that the closing/offered price was the final price. NO extra costs, taxes, HOA dues or nothing!! They had to work out who got paid, some went to the HOA, others went to unpaid garbage bills, some wnet to water and what was left went to the mortgage company. These investors can work out the same deals!!!! Go after banks, how when they close or go under??!
MOST OF THESE HOUSES WERE BOUGHT BY LIAR-LOAN DEADBEATS WITH LOANS THAT WERE SUBSEQUENTLY REPURCHASED BY FANNIE MAE AND FREDDIE MAC WHO, BY THEN, HAD LOWERED THEIR UNDERWRITING STANDARDS SO LOW AS TO LET ANY PLAIN-OLD LOSER BUY THE HOUSE. THEN FANNIE AND FREDDIE SOLD THE SLICED UP LOAN PACKAGES TO UNSUSPECTING INVESTORS AS 'PHONY' TRIPLE A RATED CDO's (colateralized debt obligations).
This is just another SHINING example of why government MUST desperately get out of the housing business. OUT OUT OUT. $150 BILLION Fannie Mae and Freddie Mac bail out TAX dollars down the rat hole and still climbing.
And then here are these near-broke HOA's trying to clean up these train wrecks that the no-pay bums and freebie-loan banks left behind.
HEY 'INVESTORS' - if there's an amount past due to the HOA for back dues and maintenance, PONY UP if you want the house. You're probably buying it at less than HALF price of what the joint was worth two years ago.
I have no sympathy for the saps, vultures and carpetbaggers who listen to these idiotic 'Get Rich Real Estate Gurus' who peddle near useless 'miracle profits methods' on TV and online and nearly guarantee you'll 'get rich' when you 'flip' or 'landlord out' your 'no money down' house.
IF YA' WANT THE HOUSE....PAY UP WHAT'S DUE THE HOA THEN *YOU* GO AFTER THE LAST OWNER FOR THE BALANCE DUE.....
I don't think you guys get it. I tried my hand at real estate investing over the past year. I would buy a foreclosed house, have a contractor fix it up and sell it. It was a win-win situation. The realtor made money, my contractor made money, I made a few bucks and the community benefited because we took an trashed house and turned it into something nice then sold it to an end useer at a good price. What is wrong with that? The problem is that the margins are small, so if you buy a house and there is some greedy ass collection company slamming you with horrendous fees (3K on a house that only cost 50) the profit margin disappears. They have you by the balls because they can place a lean on the property and prevent you from selling it and even though there demands are not legitimate you are stuck paying. The collection companies are fraudelent and should be sued. I'm out of the real estate business because of them.
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Don't buy a house that is in a HOA period.
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I was in Real Estate in the VA market of Washington D.C. A house could not be sold until we had a sign-off from the HOA that all modifications were approved and all HOA dues were collected. Whoever wanted to SELL the house was responsible. The Closing could not proceed without this release in hand. The NV Real Estate commission should be looking at this problem.
"Don't buy a house that is in a HOA period."
Simply brilliant. That eliminates at least 90% of the homes built here in the last 15 years.
HOA run comunities add tremendous value to a home. The problem is that an "investor" isn't doing his/her due diligence if they buy a home with outstanding liens that they are not aware of. If you buy a home with these obligatinos left on the title, then you should pay for them. On the other side of the problem though, is the collections agencies that are in an unregulated business charging onerous, and inflated fees. They are taking advantage of the situation, just like the mortgage brokers and others who benefited from the Liar Loans and sub prime lending wave. Somewhere in the middle is probably the answer. Bottom line is... in order for all our home values to return to where we want them, these foreclosed homes must be bought from the banks and deadbeat owners, and put back in the hands of people who will take good care of them and treat the entire community as a their home.
When buying property always demand CLEAR TITLE!
If necessary, go to the HOA, ask them what the overdue fees, penalties, etc. will be at the day of closing, then demand that the seller (most likely a bank) put that amount in escrow. Get a letter from the HOA beforehand that you will not be held liable for any costs prior to your ownership (while providing them with a similar letter from the seller that guarantees the amount to be paid at the closing).
I deal with title reports on properties all the time, these fees should show on any title report, just as past due taxes, any mortgages, etc. A smart investor will not take possession until the title is clear. It takes a small amount of research, but anyone can do it. This isn't rocket sience. I'm betting stevem is with me on this one.
HOA'S SUCK..A NEW HOME OWNER SHOULD NOT BE RESPONSIBLE FOR THE OLD HOME OWNERS DEBTS, ARE YOU GUYS FREAKN NUTS, WHEN A CAR REPOSSESSED WHEN THE NEW OWNER BUYS IT DO THEY HAVE TO MAKE ALL THE BACK PAYMENTS THAT THE LAST OWNER DIDN'T MAKE..HOA'S ARE BEING ALLOWED TO RIP OFF THE AMERICAN PEOPLE PLAIN AND SIMPLE..
"thatsright", your comparison is like apples and oranges. A H.O.A is a association of people that agree upon the purchase of a home, to pay their dues to maintain common areas and etc. If one doesnt pay, the rest suffer, it's that simple. For people to blame their decision to move into a area controlled by a H.O.A, on anyone but themselves, just supports the victim mentality that has destroyed our society to this point. I was brought up to be a man and follow through with my decisions, good or bad. People need to wake up, stand up and quit thinking everyone else needs to somehow rectify their stupid decision making skills.