Can I stop paying my HOA fees?

[BKman]

HOA fees are a part of the property. They never go away and you must keep paying the monthly assesments as long as you keep the property. A BK "may" remove the back debt but not the fees paid each month. If you dont pay the assesments when they are due you will get another lien or in some cases the HOA can foreclose on your property.

[bob1esq]

[justbroke]

I agree. However, the mere indication of "surrender" on a bankruptcy statement of intentions, does not suddenly make the debtor no longer the owner. So much so, that Florida added a Statute making creditor responsible for 12 months (or 1% of the balance of the mortgage) of HOA/CA dues/fees/assessments that occur after bankruptcy and before the creditor takes legal title. But only 12 months.

You cannot force a creditor to exercise its rights under the security instrument or the UCC so, likewise, a mere "indication" that you want to "surrender" a property, doesn't magically make it belong to the creditor. There is nothing in 11 USC 521 (a)(2) which reads "he loses all rights to ownership of the property". It only indicates that the debtor much perform the action. Most Circuits haven't found that there is anything to do in a surrender except, I would suppose, not fight relief from stay actions or other non-bankruptcy court actions.

So much so that the debtor's property rights are uneffected by what you just wrote, 11 USC 521 (a)(2)(C) goes on to say that... "nothing in subparagraphs (A) and (B) of this paragraph shall alter the debtor's or the trustee's rights with regard to such property under this title".

Congress did not say "so long as title is held in debotor's name, his HOA dues are not discharged." I believe the statute makes it clear that the debtor must have more than just title held in his name in order for his HOA dues to not be discharged.

Well, they should have fixed 11 USC 521(a)(2)(C) then. However, that would go against all principles of equitable title.

I don't believe Florida would have written the new Statute if it were not for the shortcomings in the plain and unambiguous language in Title 11. The real problem with bankruptcy law, is that it must coexist with underlying State non-bankruptcy law. Unfortunately, there's nothing in State non-bankruptcy law which allows a mere statement of "surrender" as losing title.

[bob1esq]

If the debtor must perform within 30 days, then he could no longer be legal owner of the property after that 30 days. The statute makes it clear that the debtor has no option than one of the three. The debtor has no control over what the bank may or may not do. By your analysis, the bank would control whether the debotor could surrender the property or not, and if so, when that surrender would be, whether it be in 30 days, or in 30 years. The law would be saying, he can surrender the property only if the bank or HOA or other lienholders let him. California law has a maximum of jurisprudence that says, "What is required to be done, is presumed to have been done." Just because the bank is not required to take owership to the property does not mean the debtor is required to hold onto ownership or has any legal ownership rights in the property. Why can there just not be any legal owner of the property? I am not in Florida, but in California, regardless, a state legislature cannot trump bankruptcy law (in California, there is no 1 year HOA dues rule). Although the law says the debtor's or trustee's rights to the property are not affected, it does not say that his obligations are not affected. Arguably, if his rights are not affected, then his right to surrender the collateral should not be affected. In my jurisdiction, when a debtor surrenders collateral, he is no longer obligated to pay the liens and executory contracts or leases securing that collateral. Post-petition HOA dues may not be discharged, but that does not mean the debtor is obligated to pay for expenses on collateral he has surrendered.

[justbroke]

If the debtor must perform within 30 days, then he could no longer be legal owner of the property after that 30 days.

Go re-read the statute (11 USC 521). It is very clear and unambiguous that it confers no "legal rights" upon anyone else.

Why can there just not be any legal owner of the property?

Because that would just destroy common law regarding property rights.

I think you're just grabbing at straws. Again, 11 USC 521 (a)(2)(C) clearly contemplated this dilemma and addresses it with the fact that property rights are not diminished. Not being obligated to pay a lien, doesn't magically transform a property right. Remember, the property right is entirely separate from the Promissory Note and the beneficial interest of the mortgage.

You only pledged the property as collateral. It's not a "possessory" lien.

[krisolson7]

I am in California haven't made a payment since June 2008 on my rental property...Got an NOD filed Jan 4, 2010...It has now been 4 months since the filing & I am so worried when I'm getting the trustees sale date...I know it was usually 90 days after the NOD...Are you saying it could take a few more months until the sale date ? Should I wait until I get the sale date to file bankruptcy ? I have been trying to do a loan mod for over 18 months...My principle residence (right next door) has no NOD filed as I am trying to get a "HAMP" loan mod & they don't file an NOD until you are denied..My homeowners association has served me a summons to foreclose real property asessment lien & for damages..So far no lien on property from the association..A BK attorney told me all my past dues from association will be wiped out in Chapter 7 & as soon as I file BK I will be responsible for payment of the dues, which is fine with me...I guess I am asking if I should wait a while longer to file BK or do it now to stall the sale date ? I would rather stall everything as long as I could in order to get back on my feet...Any advice would be appreciated !!

THANK YOU ALL for the terrific posts & excellent information...By the way, I took out $400,000 equity out of my California condo's & bought 10 houses in FLORIDA...Made $70,000 on one & gave all the rest back to the bank...Paid all the payments for a year on ALL PROPERTIES in FLORIDA as they were going down in value like a "SINKING SHIP...It KILLED ME as I had them all rented out...with almost $1000 a month NEGATIVE CASH FLOW on each of them !!! So most of all my equity is gone in California & I am 64 years old...I want to keep my condo's if I can when I file for BK...Does anyone know of a good site where I can find a great BK Attorney that knows about California foreclosure laws while going through a LOAN MOD ??
Sorry to ask so many questions, but I am very scared & stressed out....PLUS, I have been a realtor for 33 years and have only made 2 sales in the past 12 months...The market is so difficult now.. my buyers aren't getting qualified by the banks to purchase property as banks are scared to lend...As Rosa Dana from Saturday night live used to say "Its ALWAYS SOMETHING"...ha ha ha !!

[krisolson7]

I am in California haven't made a payment since June 2008 on my rental property...Got an NOD filed Jan 4, 2010...It has now been 4 months since the filing & I am so worried when I'm getting the trustees sale date...I know it was usually 90 days after the NOD...Are you saying it could take a few more months until the sale date ? Should I wait until I get the sale date to file bankruptcy ? I have been trying to do a loan mod for over 18 months...My principle residence (right next door) has no NOD filed as I am trying to get a "HAMP" loan mod & they don't file an NOD until you are denied..My homeowners association has served me a summons to foreclose real property asessment lien & for damages..So far no lien on property from the association..A BK attorney told me all my past dues from association will be wiped out in Chapter 7 & as soon as I file BK I will be responsible for payment of the dues, which is fine with me...I guess I am asking if I should wait a while longer to file BK or do it now to stall the sale date ? I would rather stall everything as long as I could in order to get back on my feet...Any advice would be appreciated !!

THANK YOU ALL for the terrific posts & excellent information...By the way, I took out $400,000 equity out of my California condo's & bought 10 houses in FLORIDA...Made $70,000 on one & gave all the rest back to the bank...Paid all the payments for a year on ALL PROPERTIES in FLORIDA as they were going down in value like a "SINKING SHIP...It KILLED ME as I had them all rented out...with almost $1000 a month NEGATIVE CASH FLOW on each of them !!! So most of all my equity is gone in California & I am 64 years old...I want to keep my condo's if I can when I file for BK...Does anyone know of a good site where I can find a great BK Attorney that knows about California foreclosure laws while going through a LOAN MOD ??
Sorry to ask so many questions, but I am very scared & stressed out....PLUS, I have been a realtor for 33 years and have only made 2 sales in the past 12 months...The market is so difficult now.. my buyers aren't getting qualified by the banks to purchase property as banks are scared to lend...As Rosa Dana from Saturday night live used to say "Its ALWAYS SOMETHING"...ha ha ha !!

[bob1esq]

Here is a link to a Request to Take Judicial Notice that I filed with the Superior Court of California. I believe that HOA dues post petition are discharged if the debtor has surrendered the collateral.

http://www.lemonattorney.net/HOA.htm

I would invite any thoughts on this. Does anyone know of any law to the contrary?

[justbroke]

I would invite any thoughts on this. Does anyone know of any law to the contrary?

[krisolson7]

Thank you so much !

They just denied my loan mod for my rental property & is in foreclosure...I need to find a BK lawyer in Southern California that can help me stall this foreclosure so I can still try to get a loan mod...
Does anyone have any advice ?
THIS TREAD IS EXCELLENT & INFORMATIVE...You guys have it all together !!
Kris

[rikimaroo]

Hello All,

I am a little confused by some of the legal jargon, forgive me. I was discharged chapter 7 backruptcy in January 2010. I am still living in my house with wife and kids and have been paying the HOA. I have questioned myself time and again why am I paying this if I no longer own the house and therefore do not have any obligations to it. Cany anyone tell me if I need to still pay the HOA or can I stop? I have not received any foreclose notices.

I don't own the house and looking to leave, but waiting for the right deal.

Thanks for any assistance. Perhaps the answer is in this thread and it looks like it is, but I can't tell if its after discharge or before. From what it seems like I have to pay before discharge and after that, I don't.

Help please

Thanks,
Rikimaroo

[rikimaroo]

I think i found my answer. I am still liable to the property since even though the mortgage is surrendered, I still own title of the home. Based on what justbroke was saying, it rings so true. Oh well, I will continue to pay my fee and live here mortgage free, until they foreclose or I decide to do short sale which I also still can after research. I found this website:

"This is a question that gets asked ten times a day around here, and the answer is: If you received a discharge in a bankruptcy case in which you surrendered a piece of real estate, then you don’t HAVE to do a short sale in order to rid yourself of the mortgage debt associated with that real estate. However, there are several other factors to consider that just may convince you that a short sale is still in your best interests.


1. Condominium and/or homeowners association dues and assessments. As long as the property is still in your name (which remains the case until title transfers through the completion of a foreclosure proceeding, deed in lieu of foreclosure, or other transfer of title), you remain liable for association dues and assessments even if you surrendered the property through a bankruptcy proceeding. This can be extremely frustrating if you have already vacated the property and want nothing to do with it anymore. Unfortunately, there is no way to force a lender to take title to a property or to move forward to completion of a foreclosure sale. So, if your lender seems to have no interest in taking title to the property in a speedy manner (or at all), the next best option may be to arrange for someone else to take title through a short sale. That way, as soon as the short sale is completed and title transfers to the new owner, you can officially wipe your hands clean of any future liability for condominium and homeowners association dues and assessments.

2. Personal liability. While you may no longer be on the hook for any mortgage debt associated with your surrendered property, you may still remain personally liable for accidents or injuries that occur on the property as long as you are still the owner of record (see explanation regarding transfer of title above). This why it is important to keep liability insurance in place as long as the property is still titled in your name. Completing a short sale will rid you of this potential liability.

3. Code enforcement violations. Again here, as long as the property is still in your name, you are responsible for maintaining it to the satisfaction of code enforcement rules and regulations. A short sale will help you avoid fines for things like not cutting the grass.
"

Thanks,
Rikimaroo

[justdidit]

From my understanding I'm only responsible for what comes after the date of filing with regards to HOA fees. I had somewhere between $2,500 and $3,000 worth of HOA fees built up over time of $250 a month. Filed bankruptcy and not responsible for the past amount anymore, but I'm responsible for anything after the date of filing until the bank forecloses on it.

[lfllffl]

My experience with the HOA is this:

I filed chapter 7, with the intent of keeping my home (not reaffirming - but am staying). At the time of filing, I was three months behind on dues.

My attorney told me that the debt isn't "really" dischargable, as the HOA would simply file a lien on my property for whatever amount they are still owed.

BUT - my attorney included payments on my back dues as a line item on my schedules, and as I'm over the median, this actually helped my case.

So, since I filed, I have been paying my HOA and including a small payment toward the back dues that I owe.

[goon]

For those of you that have surrendered your house but have not received notice of the foreclosure, do your self a favor and do a periodic search of the county records and/or assessor/property tax websites. I surrendered my home as part of my ch13 filing in April 2010, I never received a notice that the bank had fully taken ownership of the property, but in mid July the house transferred (confirmed via recorded deed and update to liability information on assessor/tax sites). As of now my case is not even confirmed yet.

Had I not been checking myself, I would not have known that this happened, my lawyer also had not received any notification (other than that the stay had been lifted). Basically as soon as the bank knew that they weren't getting any money out of me they refused to talk to me or notify me about anything.

In my case there was no HOA to worry about, but I insisted on keeping homeowners insurance on the property until it changed hands, in particular because I had a pool in the back yard. This at least gave me some protection if something was to happen to someone on the property while it was still in my name.

Also as another note I did not see the documents online until about a month after they were filed. Unfortunately not every county has this information available online, but if they do take advantage of it. If they don't and it has been a while since your property was surrendered, go by the recorders office and check for records (you also may be able to call the assessor/tax office and ask who is the owner of the property).