Sunday, March 07, 2010

News on Reverse Foreclosures

My Twitterpal Melissa Garcia, (@ColoradoHOAGal) pointed me to this article in the Miami Herald, which  explains the mechanics of a typical reverse foreclosure.  Reverse foreclosures are being pursued by community associations throughout the country, as associations find themselves stuck with units on which the owners will not pay and on which the lenders will not foreclose.  The problem arises everywhere, but particularly in those states with higher foreclosure rates.

A condominium or homeowners association (HOA) that forecloses a unit upon which there is a senior lien will not be able to take title, but will be able to get access to the unit, and presumably put some pressure on the lender to step up to its obligations.  The law is still developing in this area, so watch for new developments as some cases are decided.

The article also quotes another frequent blogger and twitterer, Donna Berger, (@CondoandHOALaw); Donna wisely recommends that associations rent the units after taking them from the banks.
Posted by Lincoln W. Hobbs, Esq., CCAL at 4:03 PM
Labels: ,

2 comments:

  1. Tony CartmanMon Mar 08, 09:36:00 AM 2010

    Reversing foreclosure is a difficult task... The situation is not good in the economy, specially in the real estate area

    ReplyDelete
  2. Donna DiMaggio Berger, Esq.Mon Mar 08, 12:12:00 PM 2010

    I continue to believe that these so-called reverse foreclosures are more marketing ploy than practical solution. The last thing most associations want to do after paying lawyers to take title to a delinquent unit is to pay more lawyers more fees to head back into court to force the bank to take the unit back from the association. If you really want to force the bank's hand you can notice the case for trial.

    ReplyDelete

Subscribe to: Post Comments (Atom)