Reverse Foreclosure Advice Given to Condo Associations

Reverse foreclosure advice has been given by attorneys to condo associations. The associations saddled with innumerable units facing foreclosure are having a troubled time trying to maintain the properties with dwindling resources. But it is hoped that taking recourse to reverse foreclosure would resolve the matter.

The legal procedure of reverse foreclosure permits the associations to foreclose on some of the foreclosed units. This idea has been gaining popularity right across Florida during the previous six months.

A talk was given to nearly 50 condo and homeowner associations by Larry Schner, an attorney from Boca Raton at West Boca Community Council forum. The problem is not merely about banks sleeping on unkempt units. Many have just walked away when they have gone underwater with the property worth less than the mortgage loan due amount. Some stay on in the units without paying either mortgage dues or association fees. They are managing to do so for a long time – sometimes it being two years, because the banks are now resorting to a wait and watch game hoping that the economy will recover. The banks do not want to spend time and money on foreclosures anymore. At the end of it the property they get is not worth it.
But associations can now push on and foreclose on the house even if there are tenants said Schner at the conference. They have to exit within a time frame. He said, “You have to be proactive.”

There is the element of chance involved if the house is up for short sale. But the effort will be worth it if the attorney representing the association agrees to accept flat fee. The cost may be recovered when finally the matter goes up to court.
The unit should be under occupancy and in good condition. If the previous owner had walked off with big appliances then this process may not be applicable. The question would then arise as to why should the association foreclose to obtain the unit? By doing so the association comes to own the unit and obtains a title deed. If the house is in good shape then the suggestion can be given to the owner that they could now stay on as tenants of the association or if the situation thus arises they could be evicted.
The association has to look after the property – come what may. Thus renting it out would be a good option. Schner said that right now he knew of fifteen instances where the associations have rented out the foreclosed units.

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