Nevada is just one of a number of states that is experiencing losses in property sale values as a result of homeowner association foreclosures, according to a recent report by the Nevada Association of Realtors. Statutes in Nevada allow HOAs to foreclose on homeowners for not paying their association dues.
HOA liens are given the higher priority over first mortgage holders, so their debt is first, paid off and then the lender and homeowner are taken out of the equation. As a result, many people are able to get foreclosed homes at auction for a fraction of the price by paying back HOA dues compared to what homes were initially worth. Further, all remaining debt is erased, and borrowers can be stuck paying back mortgages for houses they no longer possess.
Homeowners association foreclosures are a controversial subject in Nevada. According to a report by the Nevada Department of Business and Industry, 77 percent of Nevada residents surveyed oppose HOAs ability to foreclose on homes because of unpaid dues. Eighty-two percent believe that debt to lenders should be paid before debt to HOAs. Read more:
DOUGLASVILLE, Ga. — Whether you love or hate your homeowner’s association (HOA), you know that when the dues are due, you have to pay. But how much do you know about how that money gets spent?
A group of homeowners in Douglasville, Ga. said they’ve been trying for years to answer that question. They said that for years their dues have been going up with little explanation why. They asked to see their bank statements and receipts for spending but the board, through its attorney, repeatedly said no.
Four years ago, Iva Wilmott said he was hired by HOA treasurer Kevin Sanders to fix a fence for the neighborhood and paint some of Sander’s personal furniture. He said both jobs were paid with one check from the HOA account.
“I didn’t feel too good about it but he paid me, so I said okay,” said Wilmott.
Wilmott reported it to a friend he knew in the neighborhood but didn’t tell law enforcement. When concerns started to grow on other issues, the story of the “check” surfaced.
The Douglas County Sheriff’s Office agreed to look into it and subpoenaed 5 years of bank records to help in the case. In his interview, Sanders told Detective Skinner he paid cash for the personal projects and adamantly denied doing anything wrong.
In the recorded interview, you can hear Skinner ask, “Has there ever been any time, any occasion with the HOA account, where you have siphoned money to, let’s say, $5 or more off the account?” Sanders responds, “No.” “No circumstances whatsoever?” the detective asks again. Sanders repeats his answer, “No.”
Sanders goes on to tell the detective why he believes the allegation was made. He claimed a homeowner, Sherry Adams, was disgruntled over her HOA dues and wanted to get him removed from the board, believing that would absolve her responsibility to pay. Read more:
The typical homeowners or condominium association puts either a profit-motivated Developer or your neighboring property owners (people you may barely know, and who often lack relevant qualifications) in charge of governing your home, your lifestyle choices, AND your money.
Today, four out of five real estate sales are in condominium or Homeowners Association communities–a $90 billion a year industry representing five times the amount the federal government spends to run NASA. An estimated 70 million Americans are living under the rule of an association.
Association-governed real estate ownership (which includes condominiums, cooperatives and single family homes within a Homeowners Association) comes with considerable risks of which few are aware when they sign on the dotted line. Click here to read more