HOA Foreclosure; good source for "pre-foreclosures?"

1 Reply

I recently came across HOA foreclosures, which started from a listing.

I 've heard, depending on the state, that some may be a "super lien," going in place before the 1st, whereas others, they're 2nd, or even 3rd.

It seems that some buy the HOA foreclosure, and then rent the house out, until the lender finally forecloses, hoping that they can make back their investment in rents before-hand.

My questions are on both sides of this equation.

The general assumption is that if one's struggling to pay the HOA, they may soon be struggling to pay their mortgage. Would this make them a potential for "pre-foreclosure help?" Assuming those on the HOA board don't have an agenda to foreclose, and buy it cheap, would reaching out to HOAs to offer the solution to buy the delinquent house, and paying the HOA back fees as part of the process, so home owner doesn't face foreclosure, be a viable business model?

On the other side, if the HOA has foreclosed on the home, and the redemption period has passed, do they usually try to sale at market value, or is this a good source for deeply discounted deals?

Thanks for your time!

I have come across a couple of these where the HOA will not foreclose either because their internal documents don't allow it, they don't know how, or they don't want to deal with it. It might be better just to reach out to the homeowner directly and say that you would be willing to make an offer that would pay off any liens they may have as well. The incentive for the HOA to tell you that they are delinquent would be that they would get their overdue dues paid off.

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