Condo Line

Allowing foreclosure a big mistake

 

CAMquestion@cfl.rr.com

Q. I live in a community in which the HOA has placed a lien on my home and is now foreclosing. The auction date is scheduled next week but I would like to know how long after the auction I have before the new owner will force me out of my home. I have a mortgage and deed to my home that gives me title and not the new owner. Recently a group approached me with an offer to purchase my home. They said they will pay all debts and lease back my home to me. Should I sell to this group?

M.P., Tarpon Springs

I normally suggest that you contact an attorney, but it appears that it is too late for the foreclosure. Here is a fact of which you may not be aware: you are still obligated for the mortgage, regardless of foreclosure or sale of the home by the HOA. Foreclosure does not eliminate the first mortgage and you cannot sell the obligation to others. The new group that has made an offer will not eliminate your obligation to the note (mortgage) and other debts. My only suggestion is that you try to pay your obligations, including the HOA fees and legal costs, or move out and hope that the bank will forgive the mortgage debt. Also, you may be obligated to the IRS for any forgiveness of debt. That possibility will require that you talk to a tax attorney or a CPA. Thinking that you can just walk away from your debts is a misconception, as they will still be outstanding for years. The bottom line is that you have made a miserable choice and will live with it for years to come.

Q. I believe you were a speaker at the last Communities of Excellence awards ceremony in St. Petersburg (www.communitiesofexcellence.net) and you asked a question that I would like to share with my committee. You asked, “In a disaster what is the responsibility of the manager, the board and the owners?” Can you expand on this?

E.S., St. Petersburg

I spoke on disaster preparation at this meeting. It was more of a homework assignment, as my speaking time did not permit me to expand on the subject.

Each association, the board and all members must prepare a disaster plan. No two associations are the same because common areas and documents vary. The board has the responsibility to establish a plan to prepare the common areas for any emergency; management can assist in the creation and implementing the plan.

In Florida, we usually think of hurricanes but there are floods, earthquakes and man-made disasters. In the event of a hurricane, preparation could include trimming trees, establishing committees or employees to remove pool furniture, practicing installing shutters on clubhouses, reviewing common areas that can be damaged, and having a list and commitment from vendor services that can help after cleanup. The board can obtain pamphlets to help the members to understand their procedures to save themselves and their property. It could have government officials talk to members and provide a list of shelters. Each member isresponsible for his or her safety and protection of property. Members should have insurance in advance of any threat. If evacuation is required, they need to have necessary provisions and relocate to shelters. One additional suggestion is that all associations, the board and members establish a Community Emergency Response Team (CERT). Information can be found at http://www.floridacertassociation.net/.

Q. Several of our condominium board members are snowbirds. Their absence makes it difficult to conduct board business May through December. Are empowered executive committees legally able to deal with checks and balances in Florida? Do you have any suggestions?

R.S., Mount Dora

First, statutes allow board meetings to be conducted by absent directors using speaker phones. Also, the board can establish duties while members are away. Any budget item can be paid without specific board approval if it has been already approved. If an event occurs that was not a budget item, then the board may need to approve the extra expense. This can be done before members depart by approving a maximum amount available for emergency expenses. I have seen these amounts, subject to the association, from $1,000 to maybe as much $10,000 for non-budget repairs. Once the board has returned, the emergency expense would need post-approval to ratify the action and expense at the next meeting. I have managed associations that have one board meeting a year. Members grant or instruct the manager to complete all condominium actions and duties and only send monthly reports to the board. As long as the board has confidence in the committee and the manager, then there is no need to hold meetings while they are away. Officers can sign checks if the expense was an occurring budget item or if the repair was approved prior to their departure. Keep in mind that directors are volunteers and allowed to travel. They are not required to be on duty 24/7.

Write to Condo Line, Richard White, 6039 Cypress Gardens Blvd., #201, Winter Haven, FL 33884-4115, or e-mail CAMquestion@cfl.rr.com. Include name and city.

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