HOAleader.com - Tip of the Week - July 16, 2010
Published: Fri, 07/16/10
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When Selling Your HOA Debt Makes Financial Sense
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In this week's tip, we give you the skinny on when it's wise and
not-so-wise to go after delinquent homeowners in small claims
court. Many attorneys recommend against it, but there are
exceptions.
"In certain circumstances, small claims is a very viable option,
such as when it's a small amount of money," says Robert M.
DeNichilo, an attorney at DeNichilo & Lindsley LLP in Irvine,
Calif., who specializes in representing community associations.
"It can be very quick to get a judgment. In the one case we did
in small claims court, we got a judgment in three months compared
to the foreclosure process. You still have to collect that
judgment, but your cost of getting a judgment is so much cheaper."
The drawbacks? "You can't use an attorney, and there's a limit of
$5,000 that you can collect, and that includes attorneys fees,"
says Sharon Glenn Pratt, a principal at Pratt & Associates in
Campbell, Calif., who advises many homeowners associations. "
There also aren't strict rules of evidence, and small claims
court is really unpredictable. So I think you're better off using
superior court."
Another drawback is you also can't appeal small claims court
decisions in California. "I've had several clients go through small
claims court, and I've heard of commissioners granting zero," says
DeNichilo. "You can't appeal that; other owners hear about the
decision, and then the rumor is that you can't collect your
assessments... You have that risk."
For more information on the benefits and drawbacks of using small
claims court to collect unpaid assessments in California and
other states, see our new article:
http://www.hoaleader.com/members/455.cfm
Best regards,
Matt Humphrey
President
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Recent articles posted at HOAleader.com:
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Should You Sell Your HOA Debt?
Some companies now offer to purchase the debt of homeowners
associations, often for pennies on the dollar. Can your HOA board
consent to such an agreement and still fulfill its fiduciary
duties? Here we discuss the pros, cons, and ethics.
Click here to read full article:
< http://www.hoaleader.com/members/453.cfm >
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HOA Meetings: Does Your State Have Rules for Your Meeting Agendas?
If you can believe it, some states regulate your meeting agendas.
Check your state law and governing documents to determine rules
that govern your agendas. Here's a brief sample of state rules.
Click here to read full article:
< http://www.hoaleader.com/members/452.cfm >
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The Wrong Way to Calculate HOA Assessments
Homeowner and condo associations often come up with new ways to
calculate assessments, but sometimes they later learn their
methodology was simply wrong, unfair, or in violation of their
governing documents. Here's some guidance on identifying whether
a proposed method of determining HOA assessments passes muster.
Click here to read full article:
< http://www.hoaleader.com/members/451.cfm >
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HOA Email: Does Your State Permit Email for Handling Homeowner
Association Business?
In this article, we discuss a handful of state laws governing the
use of email to conduct condo or homeowners association business
while offering insight for making sure you're using email smartly
and legally.
Click here to read full article:
< http://www.hoaleader.com/members/450.cfm >
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HOA Communications: Six Tips for Keeping Absentee Owners in the
Loop
When owners don't live on site, it's harder to get them involved
in your homeowner or condominium association and even to
communicate with them. Here are six tips for setting up strong
communication channels with absentee owners so your association
can continue to operate smoothly.
Click here to read full article:
< http://www.hoaleader.com/members/448.cfm >
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