Have you ever wondered about how homeowners associations processes foreclosures? A homeowners association (HOA) is a private self-governing organizations formed in communities where homeowners collectively pay fees to maintain the unit/s or neighborhood. Typically run by an elected board of directors, HOAs are often formed either for a building with multiple owner-occupancies or by a real estate developer.

If you were a condo owner in a community governed by an HOA and your condo was sold at a foreclosure auction, you might think you’re off the hook for any delinquent payments to your HOA. You’re not! You will be liable for any dues while you are on title.

Today, as the market value for many properties has fallen, there isn’t enough money “left over” to pay your HOA. Most associations have governing documents that allow them to collect from a property owner personally, after the home has been lost to a foreclosure.

Bottom line – don’t just ignore your association fees because you’re in active foreclosure. You could pay for it later.

To learn more, contact attorney John Mlnarik at (408) 919-0088 or john@mlnariklaw.com.