Below you will find a list of some commonly asked questions and answers regarding the collection of assessments. Please clink the link below each question to continue reading the previously posted article that discusses each answer in depth.
A homeowner has violated the covenants, now what?
All Colorado community associations are required by the Colorado Common Interest Ownership Act ("CCIOA") to adopt responsible governance policies governing issues including a policy regarding enforcement of covenants and rules and the imposition of fines. Before an Association can assess a fine to a homeowner’s account, there are certain procedures an Association must follow. Click here for more on this topic.
The Association has received a judgment against a homeowner, now what?
The most common methods of collecting a judgment include requesting a garnishment of a homeowner’s wages (‘continuing writ of garnishment’) or funds being held in their bank/brokerage account(s) (‘bank writ’). The Association may also want to consider a receivership or foreclosure as an option to collect the outstanding debt. Click here for more on this topic.
What is a lien?
A lien is a security interest, or encumbrance, over some type of property to secure the payment of a debt or some other obligation. Homeowner Association liens in Colorado are statutory liens that attach to the real property and can include assessments, fees, charges, fines, interest, late fees, and attorneys’ fees and costs permitted by the Association’s governing documents. Click here for more on this topic.
What is the difference between a lien and a personal obligation?
When a homeowner files for bankruptcy, the personal obligation is the amount that can be collected from the homeowner personally. This is generally the amount that has come due after the filing of the bankruptcy. The lien (the entire balance), however, typically survives the bankruptcy and attaches to the property and can be collected upon the sale or refinance of the property or by foreclosing against the homeowner. Click here for more on this topic.
A homeowner has filed for bankruptcy, now what?
When an Association receives notification of a bankruptcy filing by a homeowner, the Association should notify its attorney immediately and cease communications with the homeowner. Click here for more on this topic.
What is a "super lien"?
Colorado law provides that an Association is entitled to a super-priority lien “super lien” for assessments which would have come due during the six months immediately preceding the filing of a foreclosure action by an Association, or a party holding the first Deed of Trust. Click here for more on this topic.
The property has been foreclosed upon by the bank, now what?
Once a property is sold at foreclosure sale, an Association typically has eight business days following the sale to also exercise its redemption rights. What are these redemption rights? Simply put, they allow the Association because of its lien to take title to the foreclosed property (away from the successful bidder at the sale) for the amount of the sales price at the foreclosure auction plus interest and other expenses. Click here for more on this topic.
The Association has opted to foreclose on the property, now what?
So your Association has filed a foreclosure lawsuit against a delinquent homeowner and obtained authorization from the court to conduct a foreclosure sale. Now, what happens next? Click here for more on this topic.
The Association has foreclosed upon the property and taken title, now what?
It is not uncommon for an Association to take title to a property through its foreclosure sale. This is especially likely to occur if the property has a first Deed of Trust (mortgage) and/or tax liens which exceed the market value of the foreclosed property. So what should an association do once it takes title to a foreclosed property? Click here for more on this topic.
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