Posting Debtor Lists to Collect Delinquent Condo & HOA Assessments
The Florida Consumer Collection Practices Act Prohibits Associations From Posting Delinquency Lists and Taking Other Actions to Collect Assessments and Maintenance Fees.
There have been a number of newspaper articles explaining actions taken by community association boards and managers to collect delinquent assessments. The Miami Herald reported that some associations post lists of the names of the owners behind on their fees and others deny security access devices to tenants of delinquent owners.
The Wall Street Journal reported that some associations were taking control of the unoccupied units and renting them on a short term basis until the bank foreclosed.
While we are all familiar with the idiom "drastic times call for drastic measures", community leaders and property managers should understand that Florida law prohibits unfair or abusive tactics with regard to debt collection, including the collection of assessments. Although the prohibitions in the Federal Fair Debt Collection Practices Act do not apply to the person or entity owed the debt (the 'creditor', which in this case is the Association), both community associations and their managing agents are responsible for compliance with the Florida Laws.
Among other practices, Section 559.72, Florida Statutes, prohibits the following:
- Use of profane, obscene, vulgar, or willfully abusive language in communicating with a debtor or any member of his or her family;
- Communication with a debtor under the guise of an attorney by using the stationary of an attorney or forms or instruments which only attorneys are authorized to prepare;
- Orally communicating with a debtor in such a manner as to give the false impression or appearance that such person is associated with an attorney;
- Publishing or posting, threatening to publish or post, or causing to be published or posted before the general public individual names or any list of names of debtors, commonly know as a deadbeat list, for the purpose of enforcing or attempting to enforce collection of consumer debts;
- Mailing any communication to a debtor in an envelope or postcard with words typed, written, or printed n the outside of the envelope or postcard calculated to embarrass the debtor. An example of this would be an envelope addressed to “Deadbeat, Jane Doe” or “Deadbeat, John Doe”;
- Communicating with the debtor between the hours of 9 p.m. and 8 a.m. without the prior written consent of the debtor.
While every association must be diligent with its collection efforts, those efforts must be in compliance with legal and ethical standards.
On the other hand, the Florida Courts are cognizant of the problem and have allowed Associations to have receivers appointed for the purposes of collecting rent from tenants when the owners of those units are facing foreclosure as a result of non-payment of assessments. Remember to check this site in the future for more information about proactive methods to collect assessments.
What about stating the delinquent units in the minutes of the Board Meetings for all the property owners to see? Not the general public, but just the owners.
The developers have five townhomes as Phase II in our condo complex. They are NOT paying any association fees or mortgage payments and taxes, but rent and collect over $5,000 per month. We would like to cut off the water, trash, cable, and internet and have the owners paid for these services. They will still be able to rent until the bank takes over. Would we be able to do this, because we are having high special assessments to pay our cost. Give me your opinion.
Can two family members (father and daughter) serve on the Board at the same time? They are co-owners of the unit in question.
ONE OF OUR BOARD MEMBERS WANTS TO PROHIBIT THOSE WHO OWE BACK MAINTENANCE FROM MOVING BY NOT ALLOWING THEIR MOVERS ON THE PROPERTY UNTIL ALL FEES ARE PAID IN FULL. HE WILL NOT ACCEPT THAT THIS IS AGAINST THE LAW AND THAT WE CAN PROBABLY BE SUED.
YOUR OPINION PLEASE>
In the State of Florida, when a property proceeds through the foreclosure process and the foreclosure is complete, does/did the foreclosure eliminate all liens?
This post certainly raised a lot of eyebrows.
The Association is certainly entitled to review the status of accounts - that is part of the function of the board of directors. Any owner (whether in a condo, coop or hoa) is entitled to see the financial records, including the status of individual unit owner accounts. Thus, addressing financial issues, including action against delinquent owners, in the minutes of the meetings is appropriate. However, it is still important to ensure those minutes are available only to members of the association, not third parties.
As a general rule, owners of properties subject to governance by community associations (whether condo, hoa or coops) have an easement over the common areas to enable them access to their property, even if they are delinquent. Thus, the Association cannot prevent them from accessing the unit, home or townhome. The easement benefits both the owner and his/her invitees (such as the mover). Interference with the easement exposes the Association to liability.
In Florida, condominium associations are prohibited from restricting use of the common elements or services as a result of a delinquency. However, there are other proactive methods the Association may employ to collect money owed.
Hi!
My question is, does the FL Statutes say anything about the adjustment (increase/decrease) of the monthly/quarterly dues of the HOA during the year?
By during the year i mean, if it can be adjusted say in july of the year, without waiting until next year budget.
Thanks; Ricardo
Are BOD allowed to deny access to the association facilities (pool, gym, tennis, basketball courts, clubhouse & etc.) turn off their water, take away cable & alarm and any other association expenses due to a delinquent unit owner?
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Most of the laws and rules seem designed to protect delinquent owners from associations. Meanwhile, many associations; ours included, are struggling to pay their bills and maintain properties because some owners simply stop paying HOA fees. The lien and lawsuit process is lengthy, expensive and often unsuccessful. In Foreclosures, Associations are lucky to get 6-months in overdue fees (following 12-18 months of legal action). Some even collect rent for services the HOA must then provide for their tenants ... without paying fees.
How about a little more equity in your coverage of the collection alternatives available to HOA's.
Thanks
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I saw in your blog that names of HOA debtors can not be published. We were told by our Mgmt Co that we could post an arrears list with unit numbers, not names.
Is this permissible?
RESPONSE: Thank you for your comment/question - it reveals a practice that happens every day throughout the state. It is inappropriate for owners or board members to ask the manager or the management company for legal advice. You put them in an awkward position (they are probably trying to help) and are not likely to obtain accurate or comprehensive information in response.
There has to be a better way for an association to get the monies due from delinquent owners. Placing a lien on the property doesn't help becuase most times the owner isn't paying the mortgage either.
Then the banks aren't foreclosing because they would then be liable for the monthly dues, (whether 6 months or 1 year of past dues) but certainly all future dues.
The owner has abandoned the property. So the association has a vacant unit that we are not able to get monies from.
Is there any possibility that the association can take control of the unit for a set time frame, say 1 year, and get a renter in the unit and collect the rent to cover the past dues and future dues.
The banks don't want to foreclose, the owners are gone and aren't paying anybody anything and the assoc. is having to raise dues to cover the loss of income from the dead beats.
This would be a win-win solution for the banks and Associations. The bank can foreclose in 1 year and all back dues are erased, the unit is occupied and maintained by the association, the association is receiving the needed revenue to maintain the entire complex and fund the reserves.
We have 20 out of 138 units that are not paying dues and we are paying our attorney a boat load to run the court gamet trying to get banks to foreclose as they are required to.
Please help
Thanks
I read that an association took control over a unit and began to rent it out and collect dues that way. Is this legal?
What if the bank has not foreclosed and the owner has left?
Joe Campbell