In Texas, Homeowner’s Associations (HOAs) are on a foreclosing spree, selling members’ homes on the courthouse steps for just a few thousand dollars simply because they are a few hundred dollars behind on their homeowner’s dues. Sometimes they’re even selling it to HOA board members, who turn around and sell the house for half of what it’s worth, netting a tidy profit.
It’s called nonjudicial foreclosure, and it can happen without a judge or arbitrator of any sort. Basically, they just file the paperwork. In Texas, the process only takes 27 days. The law says that HOAs can foreclose for nonpayment of dues, but thanks to a loophole, HOAs are also foreclosing for unpaid fines. Before the recession, these type of foreclosures were only 1% of all foreclosures, but since the economic downturn, that number has risen to 10%.
NPR:
Solomons says HOA board members and advocates testify and say, “‘We need the power to access and fine and foreclose, and we need the money. And we look for people in violation of the rules and restrictions that we put in place.’”“And they drive around in golf carts looking for them,” Solomons says.
The best advice for a homeowner who finds themselves behind the eight-ball like this?
“I suggest you call the association and cry,” a Houston lawyer for homeowners tells NPR.
Not So Neighborly Associations Foreclosing On Homes [NPR] (Thanks to Kai!)
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HOA’s need some serious regulatory reform, Mine is brutal but it is next to impossible to find new construction without one. It’s just greed, plain and simple. Greed at the expense of the average joe.
They did an X-Files episode on HOA’s. I suggest everyone check it out. IT MAY SAVE YOUR LIFE!
I was thinking about this as I walked my dogs last night. I love my weird neighborhood. I love the varied architecture. I love that when we wanted to build a fence, we just walked over to our neighbors’ houses and talked to them about it. If you plant something weird in your garden, people ask, “What the hell is that?” out of curiosity. They’re not looking to check it against the approved plant list.
My wife and I have rain barrels, a whirligig clothesline thing, a vegetable garden, and a few chickens in the yard. This is all in the city. When my wife told the next-door neighbors we were building a chicken coop, they said, “Just so long as you don’t get a cow.” We respect our neighbors; we help our neighbors. That said, we do what we want. I’ll gladly put up with the few inconveniences and eyesores that that freedom brings. There’s no way I could put up with a HOA and beige sprawl.
While there may be problems with a few HOA’s, the real problem is corrupt HOA management companies. At the condo where I live, we’re on our third one in five years – and except for the new one (yet) they were all a bunch of thieves in every way.