As many of you know, the association is entitled to collect a super lien payment from a foreclosing lender when a property enters into public trustee foreclosure. The super lien amount consists of up to six months of regular assessment charges that came due prior to the filing of the foreclosure. This is a monetary threshold rather than a requirement that there be six months of unpaid assessments due.  For example, if an association had monthly dues of $100.00, a super lien could be claimed for $600.00 so long as the account ledger showed this balance as due. The balance could be comprised of any combination of assessments, late charges, interest, legal fees or other charges.

Continue Reading The Importance of Monitoring Foreclosure Sales

Is your association increasing, or even decreasing, its annual assessment fees for 2017? If so, it is important that the association follow its governing documents when providing notice of the change to all owners.   In addition to providing owners with proper notice of any change, the association should also notify its attorney. This will help to ensure…

According to the Denver Post, former Denver Broncos head coach Mike Shanahan is selling his home in Cherry Hills Village for $22 million. While the home is definitely stunning, the monthly assessments are listed at $8,814.00 a month – which adds up to more than $105,000.00 a year! It’s not clear what exactly the…

Has your association increased, or even decreased, its annual assessment fees for 2016? If so, it is important that the association follow its governing documents when providing notice of the change to all owners.   In addition to providing owners with proper notice of any change, the association should also notify its attorney. This will help to ensure …

Do you think that you have a struggle convincing your homeowners that a small raise in homeowner association assessment fees is beneficial for the community? You should be very thankful that you do not manage or serve on the board of an association in the Palm Springs, California area where monthly assessment fees can run as high as $900 per month. While that amount is not uncommon in some condominium associations, in a homeowners association? Gasp! Although the assessments may cover such ‘country club’ amenities such as golf courses, gated entrances and lush landscaping in a dry climate, can you imagine trying to convince homeowners that those fees are reasonable and necessary?

Continue Reading How about those $900 monthly HOA Fees?!

By now, we all know that prior to an association turning a delinquent account over for collections, certain procedures under CCIOA must be followed. One of those procedures is sending of a notice of delinquency to a delinquent owner that includes the following information: (1) the amount due with an accounting of how the total was determined, (2) a statement as to whether the opportunity to enter into a payment plan exists and instructions for contacting the community association manager and/or board member to enter into such a payment plan, (3) the name and contact information for the individual the unit owner may contact to request a copy of the unit owner’s ledger in order to verify the amount of the delinquency and (4) a statement that action is required to cure the delinquency and that failure to do so within thirty days may result in the unit owner’s delinquent account being turned over to a collection agency, a lawsuit being filed against the owner, the filing and foreclosure of a lien against the unit owner’s property or other remedies available under Colorado law.

Continue Reading CCIOA v Collection Policy

I was recently told a story about a condominium association that is carrying property insurance coverage on their condominium units which includes a $50,000 per unit deductible on water related losses!  Evidently, this association has also adopted a policy which passes along the responsibility for the deductible to the owners of the units which were damaged.  In addition, if a unit owner is found responsible for causing a water related loss, I was told the at-fault owner is responsible for paying the $50,000 deductible for all of the units damaged by the water event.

Let’s say you live in this association and negligently caused a water related loss which damaged your unit and three others.  That would mean you could be held responsible to pay $200,000 in insurance deductibles.  Needless to say, most people are not prepared to write a check for $200,000! 

Once I thought through this scenario and picked my jaw up off my desk, my initial thought was this association has basically decided not to cover water related losses.  However, much more importantly, I thought about how absolutely essential it is for homeowners in this community to carry sufficient insurance coverage on their standard unit owners policy (commonly referred to as the "HO-6 policy") to cover payment of these deductibles. 

While the story I recounted is certainly unusual, every owner of a condominium unit should find out what deductibles their association is carrying on their property and liability insurance coverage and to what extent the owners are responsible for paying those deductibles. Once you have that information, you should contact your insurance agent and ask the following questions about your HO-6 policy:Continue Reading Are You Carrying Enough Loss Assessment Coverage?