Most people don’t realize the full impact of letting their homes go into foreclosure. This article explains how the borrower can continue to deal with the repercussions of walking away. If you or someone you know is facing foreclosure I can help with no out of pocket expenses for YOU. Please contact me today for a confidential conversation.
Foreclosure fees haunt homeowner associations
Three years into the foreclosure epidemic, desperate condominium and homeowner associations are now beginning to employ aggressive law firms and collection agencies in a new tactic aimed at recovering delinquent fees.
The debt collectors working for these associations are asking the courts to use more extreme measures. In a few cases, they have gotten judges to help them freeze and confiscate the bank account of a former owner.
Florida is gliding quietly into a new and potentially painful part of the boom-bust cycle, where stacked-up “deficiency judgments” for unpaid condo fees and unsatisfied mortgages could come back to haunt past owners. Many of them thought they had escaped further costs when they handed their home over to their lender.
When a lender sells a foreclosed home for less than the mortgage, the difference — or “deficiency” — is typically registered in the court proceedings as being owed by the original borrower, but it is seldom paid.
The same thing can happen with unpaid condo or homeowner fees. Either as part of the bank foreclosure or through a separate foreclosure action, the homeowner or condo association can ask the court for a deficiency judgment. In either case, even if these debt instruments gather dust for years, they remain valid and are accruing interest at the rate of 6 percent to 18 percent per year.
“We are going to be seeing a lot of this,” said Shari Olefson, a Fort Lauderdale attorney and author of “Foreclosure Nation.” “Florida is a recourse state, which means they can collect what they can from the property and then they can go after the deficiency by going after the investor personally.”
By Michael Pollick, Published: Saturday, June 18, 2011 at 8:54 p.m.
Link to the article:
www.heraldtribune.com/article/20110618/ARTICLE/306189990/2416/NEWS
