Considering COVID19 and its detrimental effects on individuals’ finances and livelihoods, many states and jurisdictions have ordered temporary freezes on residential foreclosures and evictions. In addition, courts have been closed to the public postponing many (if not all) court hearings and legal matters overall. Orders generally state that foreclosure actions can not be initiated due to mortgage defaults during the pandemic. Unfortunately, these orders may not specifically include homeowner associations and their fees.
Many HOAs have taken advantage of this lack of specificity in the governor mandated orders wording and have been operating with business as normal. Default notices were apparently recorded between March and May despite these freezes. What’s worse, foreclosure processes were initiated on many homes and properties due to delinquent HOA debt (which averaged about $3,000, amounts that pale in comparison to the actual prices of the homes).
For those of you that are experiencing this hardship, homeowners associations are fortunately not actually selling or auctioning off homes of those affected by this pandemic, at least until the orders are lifted. They are also offering payment plans, waiving late fees and penalties as well as delaying parking violations (another issue). Keep in mind, though, that these foreclosure and eviction freezes do not allow homeowners and renters to “live for free”. HOAs are continuing to keep track of and record missed payments. The key is to contact your homeowners association and advise them of your situation and learn of any available options.
If you are not able to pay back all your past due HOA fees and are facing foreclosure, a Chapter 13 bankruptcy call help buy you time, keep you home and may the past due payments over many months. Contact us for a free consultation.