Consider Post-Foreclosure Services

According to the National CAI office, an estimated 20% of Americans live in some kind of association of planned community.  In Nevada, that number is closer to 33%.  While the housing crisis has affected nearly all homeowners in some way, and to some degree, here in Nevada it has taken a  noticeable toll on homeowner associations.

Associations depend on the fees they charge to pay for maintenance, upkeep and repairs of common areas and community amenities.  When homeowners get behind on these fees, or lose their home to foreclosure, the board often has no choice but to cut corners.  The aesthetic effect is obvious, and often disheartening, but the effect on values can be disastrous.  And that’s just considering the common areas.

The effects of delinquent fees and foreclosures on individual properties can be even worse.  Not only do surrounding property values decline, but being able to sell the distressed properties can be next to impossible.  And it’s where a good post-foreclosure service can help.

A full-service law firm, like Alessi & Koenig, can provide services like evictions, sales, rentals, repairs, maintenance, legal action and trust accounts.  Outsourcing all the functions needed in post-foreclosure or abandoned property situations most often saves the board the time, money and aggravation it takes to turn the devaluation tide.

Now Playing… in the Nevada Supreme Court

This week the Nevada Supreme Court heard the beginnings of what is likely to be a lengthy process and series of cases to decide which of two state agencies have regulatory authority on the amount and types of collection costs that can be recovered for your HOA.

The issue has come to the forefront largely due to the number of vacant foreclosed homes that are being purchased by investors/buyers.  Their argument is that the costs piled on to the title of a property, from liens for HOA dues, fees, fines and collection costs are excessive.  They support their position by looking to the authority of the Nevada Financial Services Division (FID), which has ruled that a limit of only 9 months of HOA dues can be assessed and collected on a property.

The HOA’s position is that the amounts that can be assessed, and the collection agencies/firms that are tasked with doing the collecting, are under the authority of the Nevada Real Estate Division.  Under their rules, there is a much higher limit.

To those who do not live in an Association, it may seem that the HOAs are looking but for one more way to collect money however, it’s not that simple.  That’s why Associations would probably be well-served to do some effective educating through the media.

One of the big reasons people choose to live in an Association community is for consistent quality standards when it comes to their neighborhoods and properties.  If a home is vacant, and stays that way for any length of time, most residents neighboring that home aren’t going to want to see it fall into a state of dead foliage, weeds, broken windows or disease-breeding pools.  The Association in general isn’t going to want to see that.  So, who picks up the tab?

If the Association has additional expenses – and many do now because of the economic crisis our area has experienced – should they be allowed to recover more of those expenses.  If they can’t, or  aren’t allowed to, then it stands to reason that some of that burden will be passed on to the remaining members of the Association.

It will be interesting to see what transpires as more of these challenges make their way through the courts, but one thing can be said for certain – in the end, someone will have to pay the bills.

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