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What happens once the HOA has placed a lien on a property that will foreclose by the lender? Will they try and collect from us?

Scottsdale, AZ |

Our condo was supposed to foreclose in May and for some reason it didn't, but is set to foreclose in November. We were unaware of this and within this past 6 months have been responsible for the HOA. I have called the HOA numerous times to try and rectify the situation and never received a call back. The next thing we know is they sent us to collections and have now placed a lien on our property. They claim if we don't respond in 10 days they will file a lawsuit against us. I wanted to make arrangements with the HOA, but they never returned calls so this could take place. What happens to the lien once its foreclosed? What about the fees owed? Will the lender pay? Buyer? or will they cont. to come after us? Will we ever hear the end of it if we don't pay? Will they possibly settle for less?

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Attorney answers 1


The HOA can come after you for fees incurred during your ownership. If they file a lawsuit, the court will award those fees plus attorney's fees to the HOA. If the HOA puts a lien on the condo but does not file suit, the buyer at the foreclosure sale will take the property subject to the liens, and will eventually pay them (usually many months or even years later when the bank re-sells the condo).
If you are out of the condo, you can quitclaim your interest to the HOA, preventing them from accruing future fees, but that does not let you off the hook for fees incurred during your ownership. (The foreclosure will wipe out their new ownership interest when the bank finally gets around to foreclosing.)
You can always try to settle: they do not have to take less than the amount owed.