Homeownership > Non-Payment of HOA May Result in Foreclosure in Frisco TX

Home > Homeownership > Non-Payment of Frisco TX Homeowner's Association Dues Could Result in Foreclosure

Published May 20th 5:44pm

As part of your closing documents, you should have been fore-warned that non-payment of your Homeowner's Association dues could result in foreclosure. This is serious and has occurred more often than it should. Some Frisco TX homeowner's association property management companies have been exercising their rights to do so.

Frisco TX home foreclosure Captain Michael Clauer, a member of our Army Reserves left for Iraq in February 2008, only to return home in September 2009 to find his Heritage Lakes Frisco TX home foreclosed on by his homeowner's association. Capt. Clauer owned his property free and clear. During his departure, his wife in their $300,000 Heritage Lakes Frisco TX home failed to open mails. Hence, this caused the multiple attempts (including notices for redemption period) to contact about the delinquent homeowner's association failed. The HOA lien purchaser purchased the homeowner's association lien for $3,500 over $800 of unpaid homeowner's association dues in May 2008, then sold the property to another buyer.

Homeowner's associations in Texas has power to foreclose on properties without a court order. State senator, Royce West (D-Dallas) tries to pass legislation to curb that homeowner's association power. In the mean time, Capt. Michael Clauer's only defense is under the Servicemembers Civil Relief Act (SCRA) that suppose to protect service members from losing their homes or jobs while on active duty. The family attorney is seeking to have the court reverse the foreclosure. In the mean time, the family has an agreement allowing them to live in the home. However, it is still a long and drawn-out legal process that most likely will cause Capt. Clauer to take out a mortgage on his free-and-clear home once the foreclosure is reversed for all the debt he took on just to get his home back.

In an event when a homeowner still has a mortgage on the property, the Homeowner's Association lien is placed second to the Mortgage as 1st lien holder. Although the story of owning a $300,000 for $3,500 may seem very tempting for real estate investors, it is more common to have paid off the mortgage lien holder first in an event of foreclosure occurring due to Homeowner's association dues or the buyer of the HOA lien would have purchased the home subject to acquiring the mortgage also. Most of the time, when a homeowner fail to pay the HOA dues, the mortgage lien holder would have known about the event.

There is NO right of redemption in the event of a MORTGAGE FORECLOSURE in Texas. Hence, a foreclosure is a foreclosure immediately.

However, in Capt. Clauer's case - a HOA foreclosure, there is a 180-day right of redemption from the HOA notice about the sale. In order to redeem the property, the owner must pay the HOA lien purchaser the full foreclosed price, attorney's fees and costs plus 25% above the sale price. The HOA lien purchaser cannot sell the property to anyone other than the homeowner in the 180-day period. [In a condominium, the right of redemption is 90-days]. Right of redemption only occurs on homestead primary residences. The right of redemption does not apply to investment properties.

Non-payment of homeowner's association dues does result in foreclosure more often than you think. Hence, remember to make your payment on time.

Related Articles:

FEATURED LISTINGS


	Meadow Hill Estates Frisco TX Home for Sale 4 bedrooms, 3 baths, approx 3071 sq. ft. $239,900

	3 bedroom + Study home in Hillcrest Estates 3 bedrooms, 2 baths, approx 1925 sq. ft. $179,900

	Panther Creek Estates Home for Sale 3 bedrooms, 2 baths, approx 1894 sq. ft. $178,900

	Hardwood Floor, Granite + More 4 bedrooms, 2 baths, approx 2795 sq. ft. $219,900
» More Listings

QUICK SEARCH

DAILY FIXED MORTGAGE RATES

*Rates subject to change without notice

No Down Payment No Closing Costs Loan available in North Texas

Check out the Affordability-based Zero Down Payment, Zero Closing Cost Loan Program

FRISCO TX HOMES OF THE WEEK

REAL ESTATE MARKET REPORTS

Check out the latest local real estate market reports of Frisco, Plano, McKinney, Allen, Little Elm & Prosper TX.

Be an INFORMED CONSUMER

Texas Information about Brokerage Services

Differences between Buyer Client & Customer

How Real Estate Agents Get Paid

Join Social Media Conversations In

Active Rain is the Top Real Estate Blogging Platform

About Loreena & 3:16 team REALTY

Loreena Yeo - Realtor(R) in Frisco TX | Broker
M.Sc, B.Sc
Direct (214) 783-2210
Fax (214) 231-9018
Email Me Here

>> Learn about Loreena

>> Learn about 3:16 team REALTY

>> Check out what our clients have to say on Zillow Review

3:16 team REALTY
is a proud Member
of Frisco TX Chamber of Commerce

Loreena Yeo is the broker of record of
3:16 team REALTY to practice real estate in Frisco & surrounding cities (State of Texas). Texas Real Estate Broker License Number #9001154.

CLIENT TESTIMONIALS

Read about what our satisfied clients have to say:

When she arrived for our appointment, we went through the normal preliminary procedures and all was fine. Then she surprised us. She had already done most of the work and only needed to take a few pictures of the inside and determine the price that we would be comfortable asking. She also spent a great deal of time explaining to us how the whole sales process work and what we could expect.

Eric & Tomoko Quere, Plano TX

Ultimately, Loreena introduced us to the house we bought--it was not one we found from our own hours of searching web listings--based on the the comments we had made while we visited these different homes. This is a testimony to her ability to listen well and to work proactively on our behalf.

Jenn & Glen Miller, Denton TX

We were completely impressed with Loreena. She helped us find and buy a home in Frisco. We have very high expectations from a realtor and she surpassed them. Knows her market extremely well, not just the technical market pricing data, but the nuances of all the neighborhoods as well. One of the most responsive and professional persons I've met in my entire business career.

Ruth & Jerry Meek, Frisco TX

I just want to thank you again for your help in selling our house. In this tough economy and market, I really didn't expect to get an offer. But you counseled me so well in pricing the house to sell and yet not letting me accept an offer that was too low. I believe we got the best deal we could have. I was so pleased and surprised with what we walked away with.

Sally & Phillip Barnard, Frisco TX


PRIVACY POLICY	TERMS OF USE	Real Estate Markets

		● Milford MA Real Estate