Homeowners are often surprised to learn that their homeowners’ association may be able to foreclose on their home. HOA’s may be able to seek foreclosure in Florida for missed payments, failure to maintain property. Additionally, there may be other grounds set forth in the Association’s declarations and by-laws. In many instances, an HOA foreclosure in Florida will even involve homes with no mortgage or other liens. Fortunately, there are ways to fight back against an HOA foreclosure in Florida. If you are being threatened with an HOA foreclosure contact a foreclosure defense lawyer for assistance.
HOA Foreclosure in Florida
Florida is a judicial foreclosure state, that means a party seeking to foreclose a home must go to court and receive approval from a judge before a home is sold at a foreclosure action. This includes not just banks, homeowners’ associations must also go through the judicial process. Unfortunately, many HOA’s are very aggressive and will seek foreclosure if a homeowner fails to pay the HOA’s fees. In fact, many HOA cases stem from balances due of less than $100. Homeowners facing an HOA foreclosure in Florida should contact a Tampa bankruptcy attorney for assistance. Bankruptcy can potentially provide additional options to stop the foreclosure and help keep your home.
The Automatic Stay to Stop HOA Foreclosure in Florida
When a debtor (borrower) files for bankruptcy an automatic stay is put in place as soon as the Chapter 7 or Chapter 13 bankruptcy is filed. See bankruptcy law 11 U.S. Code § 362. The automatic stay requires all collection activity against the debtor to stop immediately, including a foreclosure sale that has already been scheduled. For more information on the automatic stay click here.
Chapter 13 Payment Plan
A Chapter 13 bankruptcy filing could allow you to avoid an HOA foreclosure in Florida all together by working out a repayment plan over a span of three to five (3-5) years for the arrearage, otherwise known as back-due payments. Essentially, the homeowner will have a 60-month loan to repay the back-due HOA fees. Most of the time, the interest rate applied to these types of payment plans is around 6%. For more information about a specific case or payment plan contact a lawyer in your area to schedule a consultation.
Under Chapter 13 bankruptcy law, junior liens (including mortgages or a homeowner’s association liens) can be stripped, or removed from homestead property. Thus, if the lien is stripped down to the market value, the remaining balance of the debt will be treated as an unsecured debt in bankruptcy. Usually, Unsecured creditors receive nothing or only a small amount of the balance before being discharged. Further, after the discharge is granted in your bankruptcy case the lien holder (HOA) will be required to remove the lien from the property. For more information on why the discharge is so important, click here.
Bankruptcy and Foreclosure Defense Law Firm
If you are thinking about filing for bankruptcy or are being threatened with an HOA foreclosure in Florida contact Florida Law Advisers, P.A. Our bankruptcy attorneys in Tampa are experienced in both bankruptcy and foreclosure defense. Every foreclosure and bankruptcy case is different, and our vast experience allows us to cater our services to each client’s individual needs. All of our initial consultations are free and convenient payment plans are always available. Regardless, if you need help HOA foreclosure in Florida, Chapter 7, or Chapter 13 we can help. Call us now at 800 990 7763 to speak with a lawyer, we are available to answer your calls 24/7.