HOAleader.com - Tip of the Week - February 8, 2013
Published: Fri, 02/08/13
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Tips for a Manager: How Do I Get Banks to Pay Up?
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In this week's tip, we help an HOAleader.com reader
improve collections on bank-owned properties at the
California association he manages. The simple answer:
treat banks as you'd treat any other owner.
When a bank takes over a property, James R.
McCormick Jr., a partner at Peters & Freedman LLP
in Encinitas, Calif., who represents associations,
has simple advice for his clients. "I tell our
associations to follow your collections policy
as quickly as possible through foreclosure,"
he explains. "That does two things. First, you'll
force the issue with the bank. It won't want to
lose the property because there's nothing senior
to its lien, and the association will take the
property free and clear. Second, by putting the
lien on the property, you ensure that if the
property goes into a short sale, which is what
happens with most of these properties, the
association will be paid something. The bank
will try to negotiate with you, but you don't
have to release that lien until your association's
debt is paid."
Our reader mentioned that banks often don't
technically take possession. "Doesn't matter,
and we don't really care," says McCormick. "We
follow our foreclosure process. We were dealing
with one last week. We called the bank and got
the runaround, 'That's another department,' and
'You need to contact this person.' We finally said,
'It's your property, but we're going to take it
if you don't get your act together.' That finally
made someone say she'd escalate the issue within
the bank. We had another one where we foreclosed
on the property and the bank only redeemed it
on the last day it had for redemption. If banks
redeem their properties, they have to pay
everything owed to the association."
Andrew Schlegel, CCAM(r), executive vice president
of community management for Orange County and
Los Angeles at Merit Property Management in
Aliso Viejo, Calif., also advises his clients
to be aggressive with banks. "A lot of board
members say, 'Why would I lien the bank?'" he
explains. "Because when the bank goes to sell
the property, it can't give clean title and the
buyer can't purchase it until the bank's paid
up on that lien.
That's not the only thing you should be doing
to improve collections on foreclosed properties.
Get another idea in our new article:
http://www.hoaleader.com/members/813.cfm
Best regards,
Matt Humphrey
President
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Recent articles posted at HOAleader.com:
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In this week's tip, we discuss discipline, specifically how and when you can
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HOA Board Member Behaving Badly? Know How and When to Discipline
You may be surprised to learn that you and your fellow volunteers can be
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members, along with the possible range of action they can take.
Click here to read full article:
http://www.hoaleader.com/members/HOA-Board-Member-Behaving-Badly-Know-How-and-When-to-Discipline.cfm
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New HOA Assessment-Comparison Tool: Cool! But Proceed with Caution
In this week's tip, we reveal a new tool to help you and potential buyers
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associations and also represents developers through his second law firm,
Solomon & Furshman LLP. The highest among Solomon's clients is $2,800 per
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Click here to read full article:
http://www.hoaleader.com/members/How-Do-Your-HOAs-Assessments-Stack-Up.cfm
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Keep an Eye on These Trends for 2013
In this week's tip, we give you a taste of the trends our experts are seeing at
their associations--and that you need to be on top of for 2013.
Click here to read full article:
http://www.hoaleader.com/public/Keep-an-Eye-on-These-Trends-for-2013.cfm
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