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An Article
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Burden of debt
Power of homeowner groups to foreclose over small sums targeted
April 10, 2005
By
Emmet Pierce
Copyright San Diego Union Tribune
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Quote from this article: "Concern about foreclosure abuses has made homeowner associations "a soft target" for critics, said McKenzie, who teaches political science at the University of Illinois at Chicago. "Associations need the power to foreclose. .........."
The media should be informing the public when they quote McKenzie that he is a lawyer who practices law in California and Illinois and makes his living from homeowner association lawsuits as well. The homeowner gets bled from all sides.
See one case of a foreclosure in a homeowners association where a woman, 83, owes Tequesta $1,764,000 in code dispute over plants Losing everything - Woman, 83, owes Tequesta $1,764,000 in code dispute over plants
Evan McKenzie, a lawyer who litigated homeowner association lawsuits in California for many years moved to Chicago. He now teaches political science and has a license to practice law in both in Illinois and California. He now promotes himself as a political scientist in the media and charges $400 an hour plus travel and other expenses to testify as an "expert" in homeowner association lawsuits.
Reporters and others promote him as a "pro-homeowner expert" even though he uses this visibility to promote judicial foreclosure powers for homeowner associations and earn legal-expert fees as a lawyer familiar with homeowner association laws .
The foreclosure powers of homeowner associations cause all sorts of devastations for families including loss of their life savings and homes. As homeowner associations are corporations, and as corporations can only be represented by lawyers, lawyers just love these situations.
Posted Jun 3 2006 4:26PM CEST
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Username withheld
, California |
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Stanley Feldsott - Attorney
Feldsott & Lee
BLA; BLA; BLA;
Couldn't expect much else from an attorney.
Our HOA; (management firm) raised the dues $6000; to collect $1000 in uncollected dues.
Guess who made out in this deal ?
Posted May 28 2006 4:56PM CEST
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melvonna riggle
(View Profile)
, Florida |
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The majority of States do not give foreclosure powers to homeowner associations.
HOA's only have the ability to lien and collect when the property is sold.
Makes perfectly good common sense and seems to be working. Those left coast legislators - what a bunch of arrogant wacks.
Posted Apr 16 2005 7:14AM CEST
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Username withheld
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See Evan McKenzie promotes judicial foreclosures..AHRC News Services
Posted Apr 15 2005 1:11AM CEST
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AHRC Staff
(View Profile)
, California |
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Stanley Feldsott:
Have you any empirical data on the number of homeowner association corporations that have gone bankrupt for failure of HOA serfs to pay their dues?
The fear of a lien on the property, much like a mechanics lien, should be sufficient to keep any HOA corporation afloat. Hell, just firing the overpaid underqualified management companies could recoup it all and then some for decades to come.
It isn't exactly rocket science. Some people have back yards bigger than the collective common areas of HOA communes....just let the individual homeowner care for their own little slice of heaven, much like they do in England's row houses and Japan's tatami homes, and get rid of the HOA garbage.
Posted Apr 14 2005 10:09PM CEST
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Username withheld
, ot |
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Well, well, well, we have known it all along, eh?
i only NEED to understand one thing when i hear that anybody is saying that "associations NEED the power to foreclose".
I frankly don't care how you interpret that. there is no excuse, no justifying, and no ifs, ands or buts. i don't consider anybody to be on my side who believes that "ASSOCIATIONS NEED THE POWER TO FORECLOSE".
The only NEEDS related to HOA's are that homeowners NEED to be protected from corrupt boards, property managers, hoa lawyers and their circus courts, that drain equity from homes, suck up reserve accounts, and who force their powers upon the serfs who blindly pay out of fear of being foreclosed upon by a so called "neighbor".
REAL NEIGHBORS DO NOT HAVE SUCH POWERS
Questions for the pre-eminent master of hoaness: (hello, hello. come in good buddy. 10-4. are ya there? Did ya get a copy on this Q&A? Is somebody out there monitoring this radio band? Perhaps out in virginia? breaker 19.....)
1. Have you any empirical data on the number of hoa corporations that have gone bankrupt for failure of a serf or multiple serfs to pay dues?
2. Have you ever received compensation for, or been paid by CAI (Community Association Institute) for providing services or for being a guest speaker for CAI?
3. Have you ever been an HOA serf?
over and out.......
i am,
Joe Homeowner
P.S. - i should be the one with the police powers to protect my hard earned equity and the roof over my head!
Posted Apr 14 2005 9:54PM CEST
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Username withheld
, ot |
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Re: Can you please give our readers your reasons for being opposed to non-judicial foreclosure...
Please note: I am a California attorney and my comments relate to California. Laws and practices in other states may differ.
I oppose non-judicial foreclosure (power of private sale) for a number of reasons. First and foremost is the availability of judicial foreclosure. The goal should be to collect assessments in a timely and efficient manner. Uncollected assessments wind up being paid for by the members who do pay their assessments.
Non-judicial foreclosure is a self help remedy and like all self help remedies exposes the Association to liability. Courts are, in my experience, quick to set the sales aside. Title companies will not insure title on these private sales.
Because there is no redemption period on private sales (a time period where, as a matter of law, the owner can come in, pay the delinquency and receive title back) distressed property dealers frequently show up at these private sales where significant equity is involved.
This not only gives rise to the horror stories we all read about, but deprives the association of the ability to undo the sale since a third party is now involved. Because judicial foreclosure carries with it a 90 day redemption period dealers and third parties rarely show up for these sales. The association usually winds up in title and can undo the sale even if the redemption period has run. The goal is to collect the assessment, not take someone's home.
Attorney fees in judicial foreclosure are set by a judge. Some judges are more generous then others, but at least there is some oversight. Although subject to some abuse by some homeowners, homeowners can relatively easily defend judicial foreclosure actions. They may lose and the attorney fee award may be much higher in a contested case, at least they have the opportunity to challenge the assessment case.
Trying to challenge a private sale is as a practical matter not feasible. The owner would have to bring a court action, get a preliminary injunction to stop the sale until the case goes to trial and post a bond. You're looking at $8,000 to $10,000 in attorney fees and costs just to prove you really don't owe the $700 in back assessments.
Private sales do tend to be quicker than judicial foreclosure by 60 days or so. However, if the owner decides to let the bank foreclose, the association's lien is wiped out. The association would have to start over and sue the owner personally.
In judicial foreclosure the action continues and the association can get a personal judgment for money. In my opinion, judicial foreclosure it a much more effective collection tool, minimizes the liability exposure of the association and provides the homeowner with a reasonable opportunity to defend against an erroneous claim.
Stanley Feldsott - Attorney
Feldsott & Lee
Posted Apr 14 2005 9:39AM CEST
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Username withheld
, California |
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Hi:
This article below was published Sunday April 11, 2005, front page headlines in the San Diego Union Tribune.
Do not have a copy, will try to get at library. It costs $1.95 to get full text .
Go to link below and search of Homeowner Associations in Archives to bring up article.
Summary
Burden of debt | Power of homeowner groups to foreclose over small sums targeted; [1,2,3 Edition]
Emmet Pierce. The San Diego Union - Tribune. San Diego, Calif.: Apr 10,2005. pg. I.1
People: Colburn, Melissa, McKenzie, Evan, Ducheny, Denise, Van Zeebroeck, Jill
Section: REAL ESTATE
Thanks
SVB
San Diego, California
Posted Apr 13 2005 11:01PM CEST
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Username withheld
, California |
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Dear Stanley:
We noticed you write in your profile, you are opposed to non-judicial foreclosures. Can you please give our readers your reasons for doing so.
Thanks for contributing to the discussions on AHRC.
AHRC Staff
AHRC - User Profile for Stanley Feldsott:
I am an attorney practicing community association law for over 30 years.I am a member of CAI and CACM.I represent both homeowners and associations.
I have long opposed non judicial foreclosures and have always used judicial foreclosure to collect assessments.
I have represented homeowners in many associations who have sucessfully unseated incumbent directors. It simply requires work
Stanley Feldsott
Feldsott & Lee
Posted Apr 13 2005 8:00PM CEST
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AHRC Staff
(View Profile)
, California |
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The San Diego Union-Tribune (Emmet Pierce, April 10, 2005) quotes, Evan McKemzie, on the need for foreclosure,
Concern about foreclosure abuses has made homeowner associations "a soft target" for critics, said McKenzie, who teaches political science at the University of Illinois at Chicago. "Associations need the power to foreclose. The problem is, in many cases foreclosures are unnecessary."
Sadly, the article does not provide an answer to the question posed by McKenzie, leaving a misleading impression of his position.
In my opinion, while he believes in foreclosure, the above misrepresents his true position on this matter. This is not a new view by McKenzie, having made these very same comments in 2004 with respect to the Arizona foreclosure bill that was partially passed, retaining only the elimination of foreclosure for violations of the covenants and rules.
But I do believe that HOAs need to have recourse to judicial foreclosure as a last resort. Associations need to get paid. They must be able to defend themselves against chronic deadbeats, or disaster will result for those who are paying their assessments as they are forced to carry the load for the free riders. Associations don't have the resources to cushion them for years of non-payment by a significant number of residents.
I think this experience did influence my views on many things. As for foreclosure, to me it is an extremely harsh remedy that should only be available as a last resort and with greatly increased limitations and protections for the owner. I want to stop these foreclosures for $250 and $2500 in attorney fees, and I think nonjudicial foreclosure should be legally prohibited.
As many know, I believe that HOA foreclosures represent an excessive punishment which was found as a violation of the due process clause of the 14th Amendment, as found by the US Supreme Court with respect to excessive punitive damages. Since the HOA advances no funds,as does the creditor or mortgage company, and cannot show actual damages, the foreclosure can onnly be viewed as grossly excessive punishment. Just look at those ratios of home value lost to debt owed, far exceeding the ratio guidelines set by the SC as to below double digits.
Posted Apr 13 2005 5:43PM CEST
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George Staropoli
(View Profile)
scottsdale, Arizona |
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