Estoppel Scams

Buyer Beware -- especially if you purchase at a foreclosure auction.  The latest scam is to inflate amounts due for past due assessments by claiming excessive fines, attorneys fees for the mortgage foreclosure work and excessive costs for collections.

The HOAs are protected because the debt runs with the land.  While you can collect the past due assessments from the previous owner, you are liable for any assessments currently due. Whether or not you able to collect from the previous owner is always a challenge.

This does not mean you are completely without defenses. There is a new trend for HOAs to lump on all kinds of charges to run the bill up and many may or may not be legal. The problem is it could easily run way more to fight them.

You should pay them a reasonable fee ($75-$125) for an estoppel and demand an itemized accounting of all charges (no lump sum amounts). By law they have 15 days to provide this or you can file summary proceedings in court.

Demand any fines be documented with proof of notice that the owner was notified of a covenant violation and an independent fining committee met and voted to impose any fines. This is one of the most abused items.

There are no court cases on point, but I argue legal fees for the HOA as a named defendant in a mortgage foreclosure are the costs of doing business. No where in the Florida Statutes or the Rules of Civil Procedure do I find any authority for a defendant to pass on the costs of litigation to a co-defendant without a court order. HOA attorneys do this anyway. Because they are entitled to attorneys fees for the collection of past due assessments without a court action filed, they believe the statute gives them the right to pass on all attorneys fees without court action. I disagree!

Check if the HOA is allowed to charge late fees and what the maximum interest they are allowed to charge. This information is in their Declarations and Bylaws. Many overcharge!

Florida Friendly Landscaping - It's the Law!

July 1, 2009 the Florida Legislature enacted a new law, Fla. Stat. 720.3075(4)(a) and (b), which makes it unlawful for any association to prohibit the implementation of Florida Friendly Landscaping. Florida Friendly landscaping is defined as any landscaping that conserves water and reduces the use of pesticides, herbicides and fertilizers.

Despite this wonderful new law some association attorneys are still demanding owners plant St. Augustine grass, which is not Florida Friendly in most locations, especially Central Florida.  These overzealous attorneys claim that while the associations cannot prohibit Florida Friendly Landscaping, they are entitled to regulate it and can still require a percentage of the lot be sod.  While the statute does not address the need for owners to  submit applications to their Architectural Review Boards (or committees), good common sense would suggest the application be completed and submitted.  This does not, however, give the association the right to deny the landscaping and to suggest the association can regulate and require certain grasses and percentages of the lot to be sod goes against the very clear meaning and wording of the statute.

The Florida Friendly Landscaping website, which is hosted by the University of Florida and the Southwest Florida Water Management District, have an interactive database.  You can select the type of plant according to the amount of sun, water, soil type and salt content of the soil.

The website also has a list of plants and their requirements for growth.  For example, Bermuda grass and Bitter Panic grass on the only two grass listed for dry conditions. St. Augustine grass is listed as requiring wet soil. Other grasses, such as Zoysia, Centipede and Lopsided Indian requrie moist-dry conditions.  This clearly establishes St. Augustine does not conserve water and landscaping companies recommend watering St. Augustine grass four times a week!

The problem with the association attorneys is they are counting on you not spending the money on huge legal bills to fight for your rights.

The Lien and Foreclosure Process in Florida

The association is required to give notice to the homeowner prior to filing the lien by sending two copies of the notice, one by regular mail and one by certified mail, that includes the amount due and the deadline for payment. For HOAs this is 45 days and for condos this is 30 days. If you missed payments, the lien will include the assessments, interest, attorneys fees, and if the governing documents allow, late fees. Once you are turned over to an attorney for collections any payments are applied to all the fees first and assessments last. 

After the lien is recorded the association must then go through the same process to foreclose before filing to foreclose on your home. Once you receive a summons, you have 20 days to file an answer and affirmative defenses or a motion to dismiss. The association will file a motion for summary judgment, which means there are no disputed facts and the association should get your home without a trial. 

DO NOT ATTEMPT TO HANDLE THIS WITHOUT AN ATTORNEY. Your best option is to negotiate a payment plan or file Chapter 13 bankruptcy to put this in a 5-year payment plan. Chapter 7 will not save the home. 

If you missed any payments, fighting over the amount with the association is useless in almost all instances because it will generate attorneys fees that you are liable for and must be paid to keep your home. The courts will award the attorneys 100% of their attorneys fees if you are at fault, even if it's a small amount and their numbers are wrong. 

The courts are facing having their funding cut thanks to the foreclosure cases clogging up the dockets. In many cases good case law is being ignored to move the cases out of the courts and owners are being denied justice and due process because of budget concerns. This has changed the owners slim chance to virtually no chance, but that's my personal opinion.

Building A Better Community

It interesting how one HOA election can turn life into your community into a living hell.  It's also interesting how the power of a few people can use the election process to change that living hell back into a community you are proud to be living in.

After years of fighting my own battles with my own HOA I was pleasantly surprised when my husband produced enough proxy votes at our annual meeting to have the first election since we bought our home in 1998.  With a majority of the votes he was able to oust the old board and put in some fresh people, including himself as President.  That was something I never would have expected. Our experience made him very anti-HOA.

We were shocked to learn that our HOA had been spending three times the amount of money on landscaping as it had spent on police patrols.  With nine homes robbed in two months, we didn't see the point of having a nice looking community that no one felt safe living in, so the first thing the new board did was hire private security.  Not that local law enforcement were not doing a good job, but private security is $15 a hour less than police patrols.  And the guys with PCI Security are amazing.  Our neighbors are relieved and grateful.  It's nice to see happy, smiling faces in the community again.

The new board also listened to owners who tried to pay their past due assessments and were refused with threats of foreclosure by the HOA.  Not any more!!!  Not only is it illegal to refuse payments, but who in their right mind wants to foreclose on a home when the owner is trying to pay!  The new board has terminated services with the association attorney and put a moratorium on foreclosures and covenant violations until they can review each case.

I'm proud of the new board with their slogan "Neighbors Helping Neighbors."  That's the way it should be.

Condo Board Members Must Be Certified!

Under the revised provision of Fla. Stat. 718, known as the Condominium Act, board members of condominiums must submit a certified written statement that they have read the governing documents of the association and the Florida Statutes and understand them to the best of their ability, or have a certificate from a class providing training that has been approved by the Department of Business & Professional Regulations.  This certified writing or certificate must be on file within 90 days of the board member taking office or the board member will be suspended from the board automatically.  The certificate must be kept by the association for five years and the board member must provide a new certificate after five years if they are still on the board.

Marketable Record Title Act ("MRTA")

The Marketable Record Title Act ("MRTA"), known as "MARTA", is getting a lot of attention these days as older homeowner associations (HOAs) are reaching their thirty-year anniversary. Under MRTA, deed restrictions expire after thirty years unless the HOA takes proactive steps to preserve them or revitalizes them after they have expired.

There is a lot of controversy with associations that did file a Notice of Preservation, but failed to comply with the statute, making their notices defective.   It is important to review the statute for the year in which the preservation was recorded because it has changed substantially.  Previously, the statute required the members, by majority vote, approve a new set of Declarations and those Declarations could not be more restrictive than the originals.  The current statute allows for the Board of Directors to vote to preserve the deed restrictions, but there are still notice requirements and filing requirements that are sometimes overlooked.