Tenants caught in quagmire of homeowners association foreclosures | Tampa Bay Times: During the recession, many Floridians fell behind on their payments not only to the banks but also to their homeowners associations. The HOAs, many of them struggling to keep up with maintenance and other expenses, foreclosed on thousands of homes to limit their losses. That created a lucrative opportunity for investors.
Here's how it works: After the homeowners association forecloses, the property is put up for auction. The property title goes to the highest bidder, usually for the amount of fees owed, often just a few thousand dollars. The winning bidders don't really own the houses but can rent them out until the banks finally foreclose and take the homes. The whole process is enabled by the glacially slow Florida foreclosure system, which takes an average of 935 days from start to finish.
While the investors rake in big profits, many of the homes languish in disrepair, causing more problems for the HOAs and discomfort for the tenants.
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This story illustrates a major downside of allowing HOAs for foreclose for delinquent assessment sums orders of magnitude below the typical mortgage arrearage. Here it works like the pitch of those real estate infomercials: get in for little money and make big profits.
2 comments:
The story also reveals a problem with "allowing HOA" corporations to dictate prohibitions against renting of other people's property.
Dear Mr. Pilot, or Professor McKenzie,
Maybe, one of you can explain, but, too,
I will ask some who know the Florida HOA fraudclosure racket to explain what is being reported in this article to me. I was under the impression those fraudulently foreclosed upon, (and I believe criminally, a very large percentage of the time because an innocent homeowner questions the finances, or other inappropriate demand for monies, by one of these criminal HOA, COA, or POA boards, or their associates), for "alleged" fines, assessments, or other "collection costs," took the homes for pennies on the dollar, like in other states, and the banks were not being paid on the notes secured by the property.
Now, this article seems to suggest, those buying these "alleged money owed," fraudclosures, are kind of like strawmen, holding the properties, making money off rents, until the bank, or other lender "totally forecloses" on the loan tied to the property.
If so, what a scam to steal homes. Don't get me wrong, because I believe there is a very, very, very small percentage of "deadbeats," who intentionally do not pay HOA, COA, or POA dues and property predators, who purchase within and HOA, COA, or POA, and are horrible, irresponsible, "neighbors," themselves, or move in thug, criminal, aggressive, and hostile tenants in, to force existing, law abiding, rule following decent homeowners out. These "types," destroy the quality of life and force their hostile, aggressive and destructive actions on anyone living around them.
So, are the banks in cohoots with the HOA's, etc., and why would they, (bank, lenders), not be providing the strawmen and renting the properties themselves, unless, of course, the banks, or lenders, do not believe the "alleged" monies owed on the properties either, but do not want to loose 100%.
Will one of you share your thoughts?
Thank you,
Cynthia
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