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KarenB3 (Michigan)
Posts: 3
Posted:
I am trying to get information from someone in the know as I am new to our associtation. Is it better to go through an attorney or collection agency if liens are ineffective.
DonnaS (Tennessee)
Posts: 5,671
Posted:

Karen,
Welcome to the site. What position do you hold on your Board? Leining is a tough proposition and the courts just don't sign them for the heck of it. We need alot more information to give you some opinions as to what you are looking for. Lein are effective when it comes to a delinquent owner trying to sell or refinance the property. But someone who is sitting on a lein and has no intention of selling or paying up is another story so let us know what you are looking to solve.
KarenB3 (Michigan)
Posts: 3
Posted:
Hi. I am the new treasurer of a 25yr old association. It appears this position was passed around a lot and the leins were passed with it. Some properties have been sold or repossed and some are current owners. These range from 2002-2007. I was just told to follow up on these and take "further action" as needed. I have no idea what to do. The other board members said they are not involved with the liens. Any insight would be much appreciated. Karen Sue
DonnaS (Tennessee)
Posts: 5,671
Posted:

Karen,
Ah ha, pass the buck to the new guy. Well, for your and your Boards information, this IS a Board action and decision, not just yours alone and like it or not, they certainly are involved. If the previous Boards had done their job, these would have had some resolution by now. Once you follow your State laws on leining, then it is up to the court system. My advice is to do this right and that means Lawyer!. An association has not the expertise on how to follow thru on this so make a reccomendation to your other members and hire a professional.

It is a double edged sword. Pay for a lawyer and lose funds because of delinquencies but no action means that your Board is not doing it's duty and not protecting it's fellow members. Not much of a choice is it but this is getting to be the biggest problem in HOA's.
JanP1 (Arizona)
Posts: 76
Posted:
When considering this question our Board, weighed the attorney or collection agency, but also the results each achieved. Because we do not lien homes on a whim, we have a written and published policy on liens for non-payment (this is required in Nevada). Another thing you should ask in your review of providers is the cost to the Association and to the homeowner. Some providers will charge the homeowner the costs of the lien and filing, up to the point of the notice of sale, at that point they require the Association to pay the fees. And of course you've actually talked to the last three Associations who used their service.
JosephW (Michigan)
Posts: 882
Posted:
Yeah, the board dumped on you, no one wants to the the "bad guy". However, given the age of some of the liens, and your statement that some of the units have been sold or re-possessed, I would recommend that you tell the board to retain an association-knowledgable attorney to clean up the past mess. If they don't like the cost, remind them that it had been their responsibility to handle it correctly in the past and to protect the association's interests by doing so and that their failure led to this need. Not necessarily a nice way to put it to fellow board members, but if they don't want to do this right, you want it on record (and in the minutes) that, at least you're fulfilling your fiduciary duties.

It's a tough time in Michigan to try and collect in any fashion. Let the lawyer get everything up-to-date, and then discuss how to proceed from there.

Joe

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KarenB3 (Michigan)
Posts: 3
Posted:
Thanks for all the info everyone. I feel much more confident going forward. Karen Sue
HaroldS (Arizona)
Posts: 906
Posted:
And a reminder if you consider a debt collection agency: They must perfomr according to the Federal Fair Debt Protection Act. There are many rules they need to follow. The debtor can also tell them in writing to quit bothering him, and they must stop. Also making false threats is not allowed. The debt collecting industry brought this law upon themselves because of their years of using all sorts of tricks to badger debtors. There are perfectly legal methods to collect debt.

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