Buying a Foreclosed Property

The most frequent question I am asked lately concerns the unpaid assessments on a foreclosed property being sold by a bank.  Anyone buying a foreclosed property must really do their homework and not only check county records for liens, but check with any homeowner or condominium association to find out the balance of unpaid assessments.  This debt is not extinguished in a foreclosure.

Condominium associations and homeowner associations have a continuing lien that runs with the land.  The safe harbor provisions of Fla. Stat. 718.116(1) (for condominiums)  and 720.3085(1) (homeowner associations) apply to the banks only and not any third party purchasing from the bank.  The balance of the assessments is due and payable by any buyer.  You can go after the previous owner for the debt, but chances are they do not have sufficient assets to pay.

There is one thing you can do.  Insist on an itemized statement with no lump sums.  This is one area that is subject to over billing practices because the previous owner is not around to dispute the debt.  There is disagreement in the legal profession on whether or not legal expenses for the association defending the foreclosure can be attached to the debt, but until someone has a lot of money to litigate this issue and then possibly appeal the decision, the only recourse against these fees is to ask the association to consider waiving them.