By Matt Tomsic
Published Aug. 2, 2012
Homeowners associations in Charleston County filed three foreclosures in July, and one home was sold at public auction to recover unpaid association dues.
The Arboretum Condominium Owners Association Inc. filed its foreclosure to recover $4,600 of unpaid dues, according to filings at the Charleston County Clerk of Court; Paddock Pointe Homeowners Association Inc. filed to recover $700; and Simmons Pointe Homeowners Association Inc. filed to recover $43,000.
Homebuyers paid an average of $250,000 for the three homes under foreclosure.
One association’s foreclosure made it to auction in July, and the association — Twelve Oaks at Fenwick Plantation Property Owners Association — bought the home during the July 17 auction for less than $1,000, according to court records. The homeowner owed $9,900 when the association filed the foreclosure; the home was last purchased in 2007 for $167,000.
Homeowners associations in Charleston County have filed roughly 400 foreclosure cases since 1996, according to an analysis by the Charleston Regional Business Journal, and 68% of the cases were filed to recover assessments and other costs worth less than $5,000. The majority of cases are dismissed, but 1% end in a home’s sale at public auction.
Charleston County has more than 750 homeowners associations, according to voluntary filings with Homeowners Association USA, which provides education, support and referrals to associations. No government agency oversees, licenses or collects data about homeowners associations, and state law provides the framework for associations to foreclose on its homeowners to recover unpaid dues and assessments.
HOAs are disgusting. This is what are neighbors do to each other, foreclose and take another neighbors home for a few hundred dollars (prior to the bottom sucking attorneys involvement that is)
What a nightmare. What a disgrace to every American who served their country.
Your rights...the Constitution?....they mean nothing in these cheesy places
It is not "the neighbors" that are foreclosing - it is the HOA corporation, a completely distinct entity.
True, there are "neighbors" that rely upon the mask of the HOA corporation to abuse other neighbors. In these foreclosure cases, you will likely find, however that the bulk of the "dues" are NOT the amounts relating to assessments that all owners pay. Rather they are trumped up with the attorney fees unilaterally added by the HOA's attorney, fines, and other junk fees. In addition, many of the HOAs hae their board's authority usurped by the HOA management company and HOA attorney. Boards often have no idea what the management company and HOA attorney are doing.
The management company and HOA attorney almost invariably belong to the same trade group, Community Associations Institute - whose members promote these practices.
In case after case after case, the "assessment" is typically on the order of hundreds of dollars. When you see large dollar amounts, they typically reflect amounts that the HOA attorney deems he is entitled to extort from the homeowner.
There are plenty of cases where the HOA attorney is demanding tens of thousands of dollars over an alleged debt of $200-$300. The attorneys and management company will often also seek a separate side agreement that the HOA board is not privvy to for the promise not to foreclose so long as the homeowner makes secret side payments to the HOA attorney/management company. This trade group practices throughout the United States. A fairly recent case out of San Antonio (HOA attorney demands $25,000 over alleged debt of less that $300 in Hern v Hidden Forest in San Antonio, Texas) is just one of a very large number of such cases.
No legitimate business would spend tens of thousands of dollars of its own money chasing down a few hundred dollars. But then these aren't legitimate businesses. The business that the HOA attorneys and management companies are in is more appropriately recognized as extortion. They always like to make little quips about HOAs preserving property values - but these are equivocal statements. They were NOT referring to the OWNER as being the beneficiary of HOAs but rather the VENDORS such as themselves.
These HOA vendors spend lots of dollars actively lobbying to ensure that the status quo (laws they originally lobbied to obtain) of their ability to extort large amounts of dollars from homeowners remains intact. The "priority of payment" scam is one of many tactics employed by this trade group's members.
Certainly the actions of these HOAs and vendors did not preserve value for the owners that were targeted. They also didn't do much for the "values" of the neighboring homes which show home sales at public auction for $500.
Next time someone says "HOAs preserve values" demand an answer as to "who". The answer is not the "owner".