Monday, February 20, 2017

Homeowners outraged that Millennium developers, HOA won't share building's rescue strategy - San Francisco Business Times

Homeowners outraged that Millennium developers, HOA won't share building's rescue strategy - San Francisco Business Times:

 "A strategy proposed by the developer and HOA of San Francisco's sinking, tilting Millennium Tower to fix the building is coming under fire this week from homeowners, who are frustrated that the group refuses to detail its repair strategy...Last August, it was revealed that the 58-story Millennium Tower has sunk more than a foot and is leaning two inches, and now faces a rash of lawsuits from both regulators and angry homeowners worried about their investment in the $350 million building.

Thus far, the San Francisco City Attorney has sued the developer, while two Millennium Tower homeowners have filed a civil claim against both the city and their neighboring Transbay Joint Powers Authority, and a separate group of 20 homeowners has sued Millennium Partners, San Francisco’s Department of Building Inspection, the City Attorney and the Transbay Joint Powers Authority for allegedly conspiring to withhold information about the building's structural issues."

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The situation is in mediation. The association says they are bound by the mediation agreement not to talk about the repair plans. That would be consistent with normal procedures for any mediation. But big HOA disputes tend to spawn multiple claims by various people that can make settlement difficult.




Friday, February 17, 2017

Mortgage delinquencies among some homeowners just spiked, spelling trouble

Mortgage delinquencies among some homeowners just spiked, spelling trouble:



"Federal Housing Administration mortgage delinquencies jumped in the fourth quarter for the first time since 2006, the Mortgage Bankers Association reported Wednesday. The FHA insures low down-payment loans and is a favorite among first-time homebuyers. The seasonally adjusted FHA delinquency rate increased to 9.02 percent in the fourth quarter from 8.3 percent in the third quarter, MBA data show. The jump, which followed the lowest delinquency rate since 1997, was driven by loans made since 2014 and early-stage delinquencies, those just 30 days past due."

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Well, that isn't good. Especially this part: "... the foreclosure activity increases in states such as Arizona, Colorado and Georgia are more heavily tied to loans originated since 2009 — after most of the risky lending fueling the last housing boom had stopped,"

Thursday, February 16, 2017

Appeals court dashes hopes for investors who bought foreclosed homes in Nevada | Las Vegas Review-Journal

Appeals court dashes hopes for investors who bought foreclosed homes in Nevada | Las Vegas Review-Journal:

See the post below.  This article explains that the real beneficiaries of the Nevada Supreme Court's decision regarding the superlien statute are investors who acquired an estimated 2,000-3,000 properties by just paying off the association's lien for unpaid assessments, fees, and costs. But the 9th Circuit left them in limbo when they declared the statute unconstitutional. Then the Nevada SC rode to the rescue again and said the statute is just fine. I'm curious as to what is going on now. Can the investors sell these properties with clear title, or is there still confusion or uncertainty about whether the purchases by these investors can be rescinded and the banks' first mortgages restored? Does anybody know?

The Super-Priority Saga Continues – Nevada Supreme Court Holds That NRS 116’s Notice Provisions Are Constitutional | Financial Services Perspectives

The Super-Priority Saga Continues – Nevada Supreme Court Holds That NRS 116’s Notice Provisions Are Constitutional | Financial Services Perspectives:



Yes, indeed. The saga continues.  To recap:

1.  In SFR Investments Pool v. US Bank, the Nevada Supreme Court ruled on 9/18/2104 that an HOA nonjudicial foreclosure on their "superlien" for unpaid assessments extinguishes a first mortgage. The bank said that they had been denied due process of law because they didn't have adequate notice of the NJF.

2.  But then on 8/15/2016,  the 9th Circuit Court of Appeals ruled in Bourne Valley Court Trust v. Wells Fargo Bank that this law violates the due process rights of the bank holding the first mortgage. Where is the state action that gives rise to a due process claim? It lies in the state legislature enacting the statute that gives the HOA the right to do this. What is the denial of DP? It relates to the adequacy of the notice to the first lienholder that the statute requires.

3.  But stop the music: The Nevada Supreme Court struck again. On 1/26/2017, they ruled in Saticoy Bay LLC v Wells Fargo bank that there is no state action, and thus no constitutional claim for deprivation of due process.



The Nevada Supreme Court and the federal 9th Circuit Court of Appeals have different rulings on the same statute. So, what does this mean? I think it probably means that the choice of courts makes all the difference. In Nevada state courts, the Nevada Supreme Court is the final authority. But if the case is in federal court, the 9th Circuit's ruling is the law.



In situations like this, the US Supreme Court has been known to grant certiorari in order to decide which interpretation should prevail.  Rule 10 of the USSC Rules provides that they are more likely to take a case if "(b) a state court of last resort has decided an important federal question in a way that conflicts with the decision of another state court of last resort or of a United States court of appeals," which is just the situation. But somebody has to present this issue to them in a real case, and I do not know if that is in the works or not.

And the statute in question was amended after the SFR case, so I defer to NV lawyers as to how big an issue this will be going forward. The language in the amendment requires more detailed notice, and includes this: "(II) If, not later than 5 days before the date of the sale, the holder of the first security interest on the unit satisfies the amount of the association’s lien that is prior to that first security interest pursuant to subsection 3 of NRS 116.3116 and, not later than 2 days before the date of the sale, a record of such satisfaction is recorded in the office of the recorder of the county in which the unit is located, the association may foreclose its lien by sale but the sale may not extinguish the first security interest as to the unit."  So now (if I am reading all this correctly) the bank gets more detailed notice and has a chance to pay off the delinquent assessments so their lien doesn't get extinguished.

Thursday, January 26, 2017

Survive the coming apocalypse inside a big pipe buried underground / Boing Boing

Survive the coming apocalypse inside a big pipe buried underground / Boing Boing

"Atlas Survival Shelters sells huge corrugated pipe shelters outfitted for living with air filtration systems, Co2 scrubbers, and power generators. A 10' x 20' shelter goes for $30-$40,000 and the "Hillside Retreat," a 10' x 51', runs as high as $109,000. Options include a big screen TV, electric fireplace, oak flooring, hatch camouflaged as a boulder, and many other fine amenities."

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As long as nobody figures out that the boulder is a hatch, you are on easy street.

Tuesday, January 24, 2017

In a community of million-dollar homes, a fight over a $500 mailbox ends in court - The Washington Post

In a community of million-dollar homes, a fight over a $500 mailbox ends in court - The Washington Post:



"The $35 wooden mailbox Keith Strong bought in 2009 seemed charming and functional for the home he shared with his wife in a posh golf community in the suburbs of Washington. It was a newer version of the mailbox the homeowners association previously approved and had sat at the end of their driveway since the couple moved to their Bowie-area home four years earlier. But no more than two months after Strong installed his new mailbox, he received an order to dump it — for a $500 mailbox upgrade. The board of the homeowners association voted to require all residents in the Woodmore golf community to buy metal mailboxes, monogrammed with the letter “W” and mounted on a decorative post. The $500 mailbox mandate angered Strong and others in the community, launching him into a seven-year fight that finally ended this month when a Prince George’s County judge signed, sealed and delivered a ruling that the board of the Pleasant Prospect Home Owners’ Association overstepped its bounds with its postal pronouncements. It’s a victory that cost Strong $33,000 in legal fees — roughly the price of 66 of the new bronze-colored mailboxes"

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This Washington Post story highlights several common features of HOA litigation: the triviality of so many of these disputes; the cost of using the court system that we all pay for to litigate them; and the way owners have to spend a fortune to contest association decisions;

Wednesday, January 11, 2017