Possible HOA foreclosure

[BrokeDavis]

Hello all,

I am trying to decide on which way to go as far as when to file. I am behind on my HOA dues. I spoke to them earlier in the week and they offered me a payment plan of a $900 payments for 3 months to bring account current. Of course this includes all extra fees and what not. There is a court hearing on the 28th of this month, and I was planning on filing before this date so the arrearage can be included in the chapter 7. I know when the HOA decides to move forward with the foreclosure they can move rather quickly. I plan on staying in the house until they tell me I can't anymore. I just want to make sure that I will be making the right decision as far as not paying them the $2700. Then I can just make any current payments that are due.

What are your thoughts on this situation? I live in Florida. I also know the trustee will take any tax return that I received this year. So there's no way of saving that. My attorney did offer me to file my tax return quickly and spend it quickly but in short of me using that money to pay off HOA dues I don't see how that will work. I don't expect to get a lot back anyway considering I don't get my W-2 from my job until February 1st.

Or should I go ahead with the payment plan? They said once they receive the first payment that will stop any court proceedings and (I'm guessing delay foreclosure).

[LadyInTheRed]

It really comes down to whether it is worth $2700 to delay the inevitable foreclosure.

Are you sure you can't keep your tax refund? I'm assuming you are not using your homestead exemption. Do you need the the $4,000 wildcard exemption and the $1,000 personal property exemption for other assets? I'm pretty sure both of those can be used for cash or a pending tax refund.

[BrokeDavis]

I thought I couldn't use the homestead exemption if I was surrendering the home in the bankruptcy. Same with the tax return since I'm filing a chapter 7 the trustee will take it. My personal property is at the $1000 though. I'd rather use the money towards moving into an apartment.

[LadyInTheRed]

I thought I couldn't use the homestead exemption if I was surrendering the home in the bankruptcy. Same with the tax return since I'm filing a chapter 7 the trustee will take it. My personal property is at the $1000 though. I'd rather use the money towards moving into an apartment.

You are correct that you can't use the homestead exemption if you are surrending the property. In fact, there is no reason to use the homestead exemption if you don't want to protect your home. If my understanding of Florida exemptions is correct, because you are not using the homestead exemption, you have a $4,000 wildcard in addition to the $1,000 exemption. Did your attorney tell you that you have to give up your tax refund? If so, ask why you can't exempt it. If you haven't discussed this with him, you should.

[BrokeDavis]

How only concern was with my paycheck and the tax return, may put me over the $4000 since I don't have a mortgage or car loan to put a dent in expenses.

[LadyInTheRed]

Does this help?

Exemptions for Wages in Florida

Wages of a head of family are fully exempt up to $750 per week. This applies to paid and unpaid wages and wages deposited in a bank account during the last six months. (Fl. Stat. 222.11.) Earnings of a person other than the head of family are protected to a lesser amount under the Consumer Credit Protection Act, 15 U.S.C. 1673.

From: http://www.nolo.com/legal-encycloped...ankruptcy.html

If you don't have enough exemptions to cover wages and your refund, there are things besides HOA fees you can spend money on before you file. But, if you have so much non-exempt cash, that you can't manage to spend it, maybe it is worth paying it to the HOA to delay foreclosure. Ask your attorney for help finding things to spend money on. Don't forget you'll need to pay attorney fees. That should take care of a good chunk of cash.

[BrokeDavis]

Thank you so much!! I paid the attorney already, just looking for ways to "spend" the money before filing.

[LadyInTheRed]

Not a terrible problem to have.

[justbroke]

LITR, the homestead exemption is in Article X Sec 4 of the Florida Constitution. The "unused" homestead exemption (wildcard) is found is F.S. 222.25(4) I think. (Don't quote me!)