We discussed last week the collection abilities of the association against delinquent owners. While most Boards would love to have the ability to collect all of the delinquent assessments through a court order, the reality is that most associations, be it condominium or HOAs, will have to pick and choose which owners to go after.
This can become an unpleasant ordeal as there are some that would be undone by the collection of unpaid assessments and fees. However, you can do a little sleuthing to determine who would be able to withstand a collection action. With regard to bank foreclosures, it is best to seek out the advice of a real estate or financial attorney. There have been recent rulings in the State of Florida that have made collecting unpaid assessments from bank owned foreclosures that are not exactly straight forward.
Things to consider when picking a homeowner to proceed with would be; a) has the owner made any attempt to pay their association fees, b) Does the owner live a flashy life-vacations, boats, new cars, c) Does the owner violate other parts of the Declaration of Covenants, Conditions or Restrictions? These are all considerations to make when choosing what homeowner to pursue collection action against. Do you really want to be the association that goes after the single mother working two jobs to support her family? Because we all know that action results in news crews and inflammatory stories, right or wrong.
The tendency in most communities is when the word gets out the association collected unpaid assessments through garnishment of wages or accounts, the delinquency rate among those that are able to pay assessments will begin to decrease. Once the association Board of Directors begins to put some teeth behind their collection efforts, word will spread.
In addition, as a member of the Board of Directors (you should consult an attorney) but there is no obligation to pursue collection action against all owners simultaneously as the courts realize that there are limits to what funds an association can apply towards these activities.