Article Courtesy of The Tampa Bay
By Susan Taylor Martin
Published April 18, 2016
Two years ago, the homeowners association of Pasco County's
Quail Ridge Villas got a final foreclosure judgment against a resident who owed
$8,217 in delinquent fees.
At the online public auction, someone bid on the property but failed to pay.
Another auction was scheduled, and again the high bidder defaulted. That
happened three more times, for a total of five invalid sales in eight months.
The repeated delays hurt
the association, which was unable to collect thousands of
dollars in fees needed for maintenance and repairs. But they
were a boon to HOA Problem Solutions, a Tampa company that had
been renting out the house for the whole time that foreclosure
proceedings dragged on.
Now, the company is accused of causing the delays itself.
HOA Problem Solutions "is intentionally impeding the judicial
process by submitting false bids'' in order to scuttle
foreclosure sales and keep collecting rent on the house, Monique
Parker, an attorney for Quail Ridge Villas, alleged in a lawsuit
filed in Pasco circuit court.
Many other associations have had similar experiences with the company,
Clearwater attorney Brandon Mullis said. He accuses HOA Problem Solutions of an
"ongoing scam'' that hurts not only the associations but also the homeowners,
renters and honest bidders in foreclosure auctions.
"If what they're doing isn't illegal, it should be,'' he said.
As the Tampa Bay Times recently reported, Florida Attorney General Pam Bondi's
office has launched a consumer protection investigation into HOA Problem
Solutions. The office has subpoenaed lease agreements and other company records
under a statute that outlaws unfair, deceptive and unconscionable business
Bondi's spokesperson would not give any details. However, Mullis said it appears
the investigation focuses at least in part on allegations that the company is
gaming the foreclosure auction process.
"I filed a complaint with the AG's office several months ago and ... I've spoken
with their office a couple of times so I'm glad things are moving forward on
that front,'' he said.
The sole corporate officer of HOA Problem Solutions is Michael Chancey, whose
uncle, Jimmy Chancey, appears on its website. Their attorney, Matthew Wolfe,
said Friday that the company is working with Bondi's office to "amicably
resolve'' the investigation and comply with "any and all'' Florida law.
HOA Problem Solutions is one of numerous property companies linked to the
Chanceys. They were among the first to recognize that there was big money to be
made when people fail to pay their homeowners association dues.
Like banks, associations can put a lien on a house and foreclose. Association
foreclosures, though, typically move more quickly to public auction because the
liens involve smaller amounts of money. By sometimes paying only a few thousand
dollars in delinquent fees and other costs, the high bidder can get title to a
home and rent it out until the bank completes its foreclosure and the property
Between 2011 and 2013, Chancey-connected companies obtained title to scores of
Tampa Bay homes by being the high bidder at association foreclosure auctions.
But in the past few years, one of the most active companies, HOA Problem
Solutions, has been getting titles directly from homeowners. Records show that
it often approaches owners right after the association hits them with a final
judgment of foreclosure. The company pays the owner a few hundred or a few
thousand dollars to deed the property to it and walk away.
HOA Problem Solutions then puts a tenant in the house, sometimes just a few days
before the foreclosure sale. At the online auction, association attorneys say,
company representatives bid under various names, default on those bids and force
the sale to be rescheduled so the company can keep collecting rent.
That's what allegedly happened with the home in Quail Ridge Villas in Spring
Hill. Five high bidders defaulted; Parker, the attorney, said that three had the
same bid number — 11578 — indicating it was the same person bidding each time.
Public records do not identify the person or company linked to that number.
"Basically, the game is that HOA Problem Solutions submits false bids at the
associations's foreclosure sales and intentionally fails to deposit the funds to
obtain title, rendering the sale invalid and requiring the association to reset
the sale again and again and again,'' Parker said. "All the while, assessments
are not being paid and the association is forced to expend additional fees and
costs to repeatedly reschedule the sales.''
"In our opinion, she added, "it's not only a scam, but it's interfering with the
The company has also found a way to make money even if an association's
foreclosure sale goes through.
Sometimes, the high bid is for considerably more than the foreclosure judgment
amount. In such cases, the surplus is supposed to go to the original homeowner
who incurred the debt. But HOA Problem Solutions says any surpluses belong to
Among those who learned that the hard way are Jeanne and Jerry Hancock.
The couple fell behind in the dues on their Land O'Lakes home after Jerry
Hancock, a real estate appraiser, lost his job when the market slumped. In
October, they deeded the house to HOA Problem Solutions after the association
got a final judgment for $9,865. The house sold at auction for $30,000, leaving
a surplus of $20,135 after the association received what it was owed.
HOA Problem Solutions already had collected rent on the house. It also got the
$20,135 after producing a contract showing the Hancocks had assigned it "any and
all rights to surplus funds that may result from a court-ordered sale of the
The couple say, however, that the company never made it clear that there might
be extra money they were entitled to.
"We're trying to buy some property now and that would have been nice to have,''
said Jeanne Hancock, a nurse. She and her husband, who is not working because of
physical problems, are currently renting in Spring Hill.
Mullis, whose clients include Oldsmar's Forest Lakes Homeowners Association, is
fighting HOA Problem Solutions in a case in which the company claims it is
entitled to a surplus of nearly $60,000.
Earlier this year, the association obtained a $6,379 final judgment against a
couple. They deeded the house to HOA Problem Solutions, which immediately began
renting it out. The high bidder at the first foreclosure auction, on Jan. 15,
didn't pay, forcing the auction to be rescheduled for March 4.
"That resulted in a sale of $65,100 to an unsuspecting investor who
unfortunately wasn't aware that she was purchasing the property subject to the
superior first mortgage," Mullis said.
As long as the association gets its money, Mullis said he is willing to vacate
the sale so the investor won't be stuck with a house she might lose if the bank
Moreover, he added, "I do not want to see HOA Problem Solutions recoup a $58,000
windfall after owning the property less than two months.''
HOA Problem Solutions has acquired title to homes in foreclosure in at least
seven Florida counties as far off as Duval. Among its rental tenants is Nicholas
McSwain, an Air Force veteran.
Last fall, he, his two children and his pregnant fiance moved from Tampa to Polk
County. They leased a house for $1,050, only to discover that there were no
Then HOA Problem Solutions "bought some used appliances at a scratch-and-dent
shop that have since broke,'' McSwain said.
What really bothered him, though, was when he got a letter from a law firm that
represents the mortgage holder.
"They didn't tell me it was in foreclosure,'' he said of HOA Problem Solutions.
"I wouldn't have signed this lease if I'd known that.''
Records show that lenders have started foreclosing on at least three other Polk
County properties that the company acquired. In the meantime, it is collecting
rent on all of those, too.