When Can an HOA Start the Foreclosure Process?

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I am on the board of a condo association in Arizona. We have one owner who apparently has abandoned his condo and cannot be found. The mailing address is at the home of a lady who has had two condos foreclosed here and refuses service of any judgment service or mail for him. He owes $24,000 since 2005 and it grows every month. It shows no loan but if you dig deep it states private loan with no info. There is a deed of trust on the same day as the 2005 sale that assigns rents to his dad. We have the dad’s two home addresses locally. There is no one living in the condo. Can we foreclose? Maybe it will bring the “private loan” info out in the open? There are 3 years of tax liens also on the condo. We also have an owner that paid 2 1/2 years of maintenance fees in 2012, since now 2 1/2 years hasn’t paid again his fees. He apparently lost his job and car and has abandoned the condo. He is very upside down on his loan and hasn’t paid 2014 taxes. Can we foreclose even if we are second in line, just to get it sold and get someone to pay maintenance? We have nowhere to serve the judgment against him for $11,000.

[NOTE: Articles and answers on DearEsq., while written and published by lawyers, do not constitute legal advice, and no attorney-client relationship is formed by your reading of this information. You should always consult with an attorney for any legal situations.]

At some point, these sorts of debts can be foreclosed. When that point is, and what steps you have to take before the foreclosure, varies from place to place and also depends on your HOA’s documents.

What you need to do is speak to someone — either an attorney or a foreclosure company — who can look over the specifics of your situation and advise you what you can do in your particular case.

Keep in mind, though, that being in second place means that any foreclosure will be “subject to” the senior liens. Meaning that if the HOA purchases the property at a foreclosure sale, they will potentially be on the hook for those senior lien payments. And, of course, tax liens are usually in first place by law. So it’s worthwhile to look at the size of the existing liens versus the market value of the property before you spend a lot of time and money chasing after what may not be collectible.

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Author: House Attorney