|
Article Courtesy of
AZ Central
Published August 8, 2004
SACRAMENTO,
Calif. - If California bans the majority of its homeowner association
foreclosures, it will become the great exception among major Sun Belt states
where private communities thrive.
Associations in Florida, Texas, Arizona and Nevada all have authority to
ultimately collect their members' unpaid assessments by selling their homes.
Combined with California, the five states have more than half the nation's
association-governed housing.
The rest of the United States remains a mixed scene of varying laws and
approaches.
Hawaii, which claims the nation's highest percentage of its population living
in association-governed housing, has allowed nonjudicial foreclosure - actions
taken without a judge's oversight - since 1999. But the process is more
difficult than in many states, giving banks first priority for unpaid debts
and often making associations the only bidders for homes they foreclose upon.
In Virginia, where nearly all housing in new suburbs outside Washington, D.C.,
are in associations, the Legislature tightened rules for nonjudicial
foreclosure. Now homeowners are given more notice of a potential sale and
independent trustees are required to conduct it.
Elsewhere, such foreclosures are rare. New York and Connecticut make
associations go to court to foreclose for unpaid assessments.
In densely populated New Jersey, associations usually seek judgments against
their members in court, getting authority to garnish their wages and make
claims on their bank accounts, says Morristown attorney Dave Ramsey.
Idaho Association of Realtors spokesman Alex Labeau says he's never heard of
an association foreclosing on residents for unpaid assessments. "That
would be totally unacceptable in Idaho," says Democratic state Rep. Wendy
Jacquet.
Efforts have been made in other Sun Belt states to crack down on nonjudicial
foreclosures. Arizona House Majority Leader Eddie Farnsworth tried this year
to ban them, but succeeded only in banning foreclosures for late payment of
fines.
In Texas, Republican state Sen. Jon Lindsay, tried to ban nonjudicial
foreclosure and require a two-year waiting period for judicial foreclosures,
but he couldn't get votes to pass the bill, says legislative assistant Rob
Edwards.
Florida, likewise, tried this year to ban nonjudicial foreclosure. But a
compromise measure signed in June by Republican Gov. Jeb Bush only banned
foreclosures for fines, while keeping it for unpaid assessments.
"Next year we try again," says Jan Bergman, who heads an activist
group of association residents, Cyber Citizens for Justice. |