If the mortgage foreclosure sale has not occurred, then the lender does not own the unit. They are not responsible for the condo dues. When the property is sold at foreclosure sale and if the lender becomes the owner, then the lender will have to pay the outstanding condo dues. The Condo association can then sue the lender for the outstanding amount or foreclose on the property.
In Florida, when a lender finalizes the foreclosure action, either a third party buys the property at auction or the lender ends up obtaining title to the property. Under both circumstances, a Certificate of Title is issued. If the title is issued to the lender (no bidder at auction), the lender only owes 6 months of back assessments to the association AND must then begin to pay all future monthly assessments. If they fail to pay, the association can file a lien against the unit and later foreclose on it (just like any other non-paying unit owner). I find that whenever a foreclosure suit is instituted against a lender for non-payment, the lender quickly pays up. You should be able to find an attorney that will handle this kind of work with only the court costs and other misc costs advanced by the association (attorneys fees are ultimately paid for by the lender). The association can not handle this matter without an attorney, so you should seek the advice of one and retain him/her to begin the foreclosure process. This is a relatively inexpensive process for the association and the association has a great chance of recovering all costs expended and having the past due assessments (as explained above) paid.
This has become a major problem in Florida. While by law, the foreclosing bank only has to pay 6 months past assessments when it acquires title via foreclosure, from that point forward it is a unit owner like any other. If it fails to pay its assessments, it can be liened and foreclosed on by the association, just as any other delinquent property owner.
Condo associations are in a terrible financial squeeze with the number of foreclosures escalating, and with the banks capped at 6 months past due assessments. However, that limit only is applciable up to the time the bank takes title - after that, it has the same obligations to pay the association as everyone else.
We are working with several associations to collect against banks that have foreclosed out owners, and now are guilty themselves of not paying their obligations.