Neighbors forcing neighbors into foreclosure

[karim0028]

http://www.sacbee.com/827/story/1938...ef=patrick.net

This is why i will never buy in an HOA... Its simply makes you subservient to

1) Govt
2) Bank
3) HOA

In that order...

Neighbors are forcing neighbors into foreclosure

IRVING, Texas -- Thousands of Americans who have generally kept up with their mortgages are still in danger of losing their homes because they made a fateful trade-off in this shaky economy - they let their homeowner association dues slide.

Many homeowners are learning to their surprise that condo and neighborhood associations that oversee security patrols, mow lawns, plant flowers and clean the community swimming pool may have the right to foreclose when dues aren't paid. That right is often written into the purchase agreement signed by the homeowner.

Never understood them, will never buy in them.... 1200 dollars a year to mow the lawn and get cable, what a F%*&@$! ripoff....

[flintlock]

Re: Neighbors forcing neighbors into foreclosure

Do they not know the costs upfront? Do they not agree to pay them? While I will agree some jack up fees after the fact, the truth is, bills have to be paid. I personally despise HOAs and when my business is asked to work for them I say " No thanks". They tend to be run by control freaks.

But I don't see why not paying your HOA fees should be excused. What if everyone takes that attitude. The whole system breaks down. Most I'm familiar with let non payment slip for a long time before they take any legal action.

I live in an HOA neighborhood. Only because I can't afford 5 acres where I live and I don't want a car on blocks next door. Well my neighbors across the street haven't paid their HOA fees since they moved in 3 years ago!. Since they moved in they have bought 3 brand new cars, one a Lexus SUV. We are sometimes asked to watch their pets when they go on their monthly getaway at the downtown Ritz Carlton Hotel. They have a lien on their home of course, but have not been foreclosed on. Some know how to play the system. People like that are probably not typical, but I get pretty annoyed when I have to write that $675 check every year and they don't.

[karim0028]

Re: Neighbors forcing neighbors into foreclosure

Do they not know the costs upfront? Do they not agree to pay them? While I will agree some jack up fees after the fact, the truth is, bills have to be paid. I personally despise HOAs and when my business is asked to work for them I say " No thanks". They tend to be run by control freaks.

But I don't see why not paying your HOA fees should be excused. What if everyone takes that attitude. The whole system breaks down. Most I'm familiar with let non payment slip for a long time before they take any legal action.

I live in an HOA neighborhood. Only because I can't afford 5 acres where I live and I don't want a car on blocks next door. Well my neighbors across the street haven't paid their HOA fees since they moved in 3 years ago!. Since they moved in they have bought 3 brand new cars, one a Lexus SUV. We are sometimes asked to watch their pets when they go on their monthly getaway at the downtown Ritz Carlton Hotel. They have a lien on their home of course, but have not been foreclosed on. Some know how to play the system. People like that are probably not typical, but I get pretty annoyed when I have to write that $675 check every year and they don't.

People know the terms of upfront; my gripe isn't so much about the fees, its about at what terms.... I see HOA's as completely useless...

Respectfully, I honestly dont get the "Cars on blocks" argument... Housing existed before HOA's, will exist after them, and there are plenty of neighborhoods that don't have HOA's that function fine and don't have cars on blocks... Where i grew up (Minneapolis) the city had ordinances like "no cars on blocks" and "grass must be no longer than certain height" and "snow must be shoveled", if you didn't keep up the city came and did it for you and charged you a cool $250.00 for the privilege of a lawn mowing.... I know bc my parents got that fine after i wouldn't shovel the snow and the city came in with a bob cat and shoveled the snow on the side walk and believe you me it only took one fine before my parents made damn sure the shoveling got done... That pretty much took care of it.....

I don't get the logic of paying an "extra" mortgage to have someone cut my lawn and provide me basic cable.... And to top it off, they have foreclosure rights that appear to even supersede the bank mortgage.... You are essentially serving two masters... An HOA can foreclose on you faster than the govt can for non payment of property tax....

And as is happening now in places like FL, AZ, CA and around the country, if you get entire neighborhoods or condos sitting empty EVERYONE that is left has to pay through the nose to keep up empty units.... Its a "we all survive together or die together" mentality, its essentially giving up your personal freedom to do as you wish with your property and holds the very real possibility of being held "hostage" by neighbors....

An HOA at its heart is a cash flow expense (exactly like prop taxes) that takes away from the value of the entire community, bc it must be taken into account when listing your monthly expenses vs renting and its ~ 1/4-1/5 a normal mortgage..... ADD onto that if a community begins to empty out, HOA fees will rise faster and higher than most property taxes).

When the house value declines to 70K but has an HOA expense of $150-200, guess what that just dragged that property value down some more, bc that 200 dollar payment is essentially half what it would cost to mortgage that property at prevailing interest rates and cuts into profits when renting.... Its essentially an unchanging/unwavering obligation/debt similar to a bank mortgage that gets paid come hell or high water whether your in an equity position or underwater....

Call me old fashioned (and im under 30 by the way) but if i pay a house off the only thing i want to be left obligated paying is the prop taxes (bc those i cant get away from)....

Hope, i dont sound like im pissed off or anything Just doesn't make sense to me to give up personal freedoms to a private party that can easily be rigged by playing favors and finding allies....

[gwynedd1]

Re: Neighbors forcing neighbors into foreclosure

http://www.sacbee.com/827/story/1938...ef=patrick.net

This is why i will never buy in an HOA... Its simply makes you subservient to

1) Govt
2) Bank
3) HOA

In that order...



Never understood them, will never buy in them.... 1200 dollars a year to mow the lawn and get cable, what a F%*&@$! ripoff....

I am with you. I really don't get it. The one bureaucracy that is so easily avoided and still they come. I would rather sit on a thistle center stalk of a grievously untended lawn requiring a harrowing proctological procedure to set things right than the prickly rape they have in store for me. $1200 a year is cheap. Twice that and more is often the case where I am.

[Wild Style]

Re: Neighbors forcing neighbors into foreclosure

Do you guys think they will start passing laws to limit what HOAs can do and to limit their fees? They need to make the banks pay their share too instead of pushing it back onto the other unit owners.

[flintlock]

Re: Neighbors forcing neighbors into foreclosure

People know the terms of upfront; my gripe isn't so much about the fees, its about at what terms.... I see HOA's as completely useless...

Respectfully, I honestly dont get the "Cars on blocks" argument... Housing existed before HOA's, will exist after them, and there are plenty of neighborhoods that don't have HOA's that function fine and don't have cars on blocks... Where i grew up (Minneapolis) the city had ordinances like "no cars on blocks" and "grass must be no longer than certain height" and "snow must be shoveled", if you didn't keep up the city came and did it for you and charged you a cool $250.00 for the privilege of a lawn mowing.... I know bc my parents got that fine after i wouldn't shovel the snow and the city came in with a bob cat and shoveled the snow on the side walk and believe you me it only took one fine before my parents made damn sure the shoveling got done... That pretty much took care of it.....

I don't get the logic of paying an "extra" mortgage to have someone cut my lawn and provide me basic cable.... And to top it off, they have foreclosure rights that appear to even supersede the bank mortgage.... You are essentially serving two masters... An HOA can foreclose on you faster than the govt can for non payment of property tax....

And as is happening now in places like FL, AZ, CA and around the country, if you get entire neighborhoods or condos sitting empty EVERYONE that is left has to pay through the nose to keep up empty units.... Its a "we all survive together or die together" mentality, its essentially giving up your personal freedom to do as you wish with your property and holds the very real possibility of being held "hostage" by neighbors....

An HOA at its heart is a cash flow expense (exactly like prop taxes) that takes away from the value of the entire community, bc it must be taken into account when listing your monthly expenses vs renting and its ~ 1/4-1/5 a normal mortgage..... ADD onto that if a community begins to empty out, HOA fees will rise faster and higher than most property taxes).

When the house value declines to 70K but has an HOA expense of $150-200, guess what that just dragged that property value down some more, bc that 200 dollar payment is essentially half what it would cost to mortgage that property at prevailing interest rates and cuts into profits when renting.... Its essentially an unchanging/unwavering obligation/debt similar to a bank mortgage that gets paid come hell or high water whether your in an equity position or underwater....

Call me old fashioned (and im under 30 by the way) but if i pay a house off the only thing i want to be left obligated paying is the prop taxes (bc those i cant get away from)....

Hope, i dont sound like im pissed off or anything Just doesn't make sense to me to give up personal freedoms to a private party that can easily be rigged by playing favors and finding allies....

Hey, I'm with you on not particularly liking HOAs. But believe it or not, they do serve a purpose in most cases. There are common grounds that must be administered. Pools, tennis courts, etc. If not an HOA, who would do that? Grass has to be cut, the pool maintained, tennis courts, utilities, etc. In my neighborhood, we have common areas and drainage areas that belong to no owner, but must by law be maintained. Those costs don't go down just because homes are being foreclosed on. To ignore the maintenance is to furthur reduce the value of al the homes.

Not everyone lives inside a city limits with ordinances on the books that prevent things like cars up on blocks, etc. I don't. Its up to the neighborhood to set up its own rules and enforce them. These rules are usually set up when the development is started and anyone who buys a home there gets a copy and agrees to those rules. What is wrong with that? If I move next door to you and paint my home purple, what do you think it does to your home value? CHOOSE to live in my neighborhood and I can't paint it purple. Choose to live with no HOA and you take your chances.

You seem to think the HOAs are set up to make money or rip off owners. I assure you most are not. Those expenses are real. Sure, sometimes they abuse their power or pay too much for services. Some even do so because they want a personal kickback. But that is a different issue. Its very expensive to maintain neighborhoods and those expenses are for the most part fixed, regardless of the ability of each owner to pay. My neighborhood takes about $160,000 year just to maintain what it has. And its nothing fancy. People stop paying and you will see things start to fall apart fast.

I can fully understand why some choose not to live under an HOA. You have to weigh the pros and cons. But the fact is, you have a choice, its not something that is thrust on the owners after the fact. Don't want it, don't buy. I'd be very cautious of buying a condo or townhouse in this economic climate for the reasons you gave.

[BadJuju]

Re: Neighbors forcing neighbors into foreclosure

My neighborhood takes about $160,000 year just to maintain what it has. And its nothing fancy.

What is being maintained?

[cjppjc]

Re: Neighbors forcing neighbors into foreclosure

Lots of HOA's and other associations are unable to make repairs on decks and other things, because of the forclosures and non payments of residents. It can turn into more than just as eyesore.

[aaron]

Re: Neighbors forcing neighbors into foreclosure

From my point of view, the HOA fees I pay are excessive. Moreover, the developer runs it. They basically make us pay to keep the neighborhood perfect so they might have a chance to sell their over-priced houses. I have never heard of a neighborhood getting together to form an HOA. They are imposed on buyers from the beginning. I also do not know of ANY new developments that do not have an HOA. It is just too advantageous to FIRE.

[karim0028]

Re: Neighbors forcing neighbors into foreclosure

One of the most important things to consider when purchasing any condominium, house within a HOA or cooperative is the percent owner occupied. Properties with as close with 80-100% owner occupancy should be considered. The chances of a significant amount of owner occupants defaulting is less then the chances of a single sponsor or investor defaulting. If one does their own due-diligence they should be able to make an educated decision.

If this differs from Southern or Western States I would be interested in hearing about it.

You wanna see condos which are being foreclosed on with more than 50% of the community empty check out florida, AZ, CA, and tons of other places, not just the south and southwest... I would venture to guess condos are the first to go derelict due to the fact that when the real estate market collapses condos are usually the first and primarily the hardest hit. When condos collapse they collapse hard; they swim together or die together....

[flintlock]

Re: Neighbors forcing neighbors into foreclosure

I wish I still had the list, but from memory,

Two pools, several Tennis courts, Lifeguards, utilities and garbage service for those areas, Repair of never ending vandalism we have at the pool area, a quite extensive entry that needs yard maintenance, Flowers at entry and other common areas every year, hundreds of street lights have to be paid for on a monthly basis( one of the biggest expenses), retention ponds need constant upkeep, fencing around ponds need repairs due to falling trees, Insurance, Legal fees because of deadbeat neighbors, Accounting fees, Management fees, a few social events every year are paid out of the HOA fees. Plus other stuff I can't remember.

I was skeptical and went over the books pretty well, and most is legit. They could cut out some things and every board member has some pet project they want to do. This year we cut the lifeguards, and they finally decided to listen to me and are going to purchase a security camera system to discourage the teenage punks who trash the pool area every year. One year that was over $10,000 worth of damage. The developer was slick and cut a deal with the power company to charge us high fees for the streetlights in perpetuity instead of paying for them up front. So we are stuck with that. Developer also didn't install lights at the Tennis courts, so that was $25,000. Pool electrical panel was installed in a tiny room with chemicals, so it needed replacement. Stuff like that constantly. It's 275 homes. This year they are paying to replace all the rotted and shabby looking mailboxes.

What bothers me is that a lot of homeowners think $575 year will buy them a country club lifestyle. They constantly ask for things like a new clubhouse! Yeah right. :rolleyes:. We barely maintain what we have. And with buildings and equipment getting older, the costs will only go up. Most people have no clue what things cost.

[BadJuju]

Re: Neighbors forcing neighbors into foreclosure

Sounds like hell. :p

Give me a secluded 300 sq ft home surrounded by forest and I will be happy.

[cjppjc]

Re: Neighbors forcing neighbors into foreclosure

I wish I still had the list, but from memory,

Two pools, several Tennis courts, Lifeguards, utilities and garbage service for those areas, Repair of never ending vandalism we have at the pool area, a quite extensive entry that needs yard maintenance, Flowers at entry and other common areas every year, hundreds of street lights have to be paid for on a monthly basis( one of the biggest expenses), retention ponds need constant upkeep, fencing around ponds need repairs due to falling trees, Insurance, Legal fees because of deadbeat neighbors, Accounting fees, Management fees, a few social events every year are paid out of the HOA fees. Plus other stuff I can't remember.

I was skeptical and went over the books pretty well, and most is legit. They could cut out some things and every board member has some pet project they want to do. This year we cut the lifeguards, and they finally decided to listen to me and are going to purchase a security camera system to discourage the teenage punks who trash the pool area every year. One year that was over $10,000 worth of damage. The developer was slick and cut a deal with the power company to charge us high fees for the streetlights in perpetuity instead of paying for them up front. So we are stuck with that. Developer also didn't install lights at the Tennis courts, so that was $25,000. Pool electrical panel was installed in a tiny room with chemicals, so it needed replacement. Stuff like that constantly. It's 275 homes. This year they are paying to replace all the rotted and shabby looking mailboxes.

What bothers me is that a lot of homeowners think $575 year will buy them a country club lifestyle. They constantly ask for things like a new clubhouse! Yeah right. :rolleyes:. We barely maintain what we have. And with buildings and equipment getting older, the costs will only go up. Most people have no clue what things cost.

Play tennis during the day. It stays light till 8 you know.

[Wild Style]

Re: Neighbors forcing neighbors into foreclosure

You wanna see condos which are being foreclosed on with more than 50% of the community empty check out florida, AZ, CA, and tons of other places, not just the south and southwest... I would venture to guess condos are the first to go derelict due to the fact that when the real estate market collapses condos are usually the first and primarily the hardest hit. When condos collapse they collapse hard; they swim together or die together....

I live in S. Florida and can vouch for this statement. Going to downtown Miami @ night is like a scene from 28 days later.

[flintlock]

Re: Neighbors forcing neighbors into foreclosure

No doubt about it, when you buy into a community like that, you are assuming some risk. Of course buying a home with no HOA can be risky as well. Personally, I wouldn't buy a home without HOA protection unless I had at least about 2 acres of buffer, or the house values were high enough to virtually guarantee people took care of their homes and tended to be responsible.

Even then no guarantee of that. My brother lives in a gated community of about 20 homes. Probably $800,000 up to 3 million. The Televalgelist down the street built a gaudy house with 25 foot tall statues of Cobras and other Bizzare Egyptian looking motifs. lol. The HOA fought him but I think his attitude was, "fine me all you want, I have plenty of money." ( the church's money of course!)