Many homes, condominiums, and townhomes in the Florida will be included in a homeowners association (HOA). If the property is part of an association, the homeowner will likely be required to make payments to the HOA. The fee will vary between each association but in some cases can be hundreds of dollars each month. Further, the HOA may be able to add late fees, attorney costs, and file for an HOA foreclose in Florida. Fortunately, homeowners who have fallen behind on HOA payments may be able to stop HOA foreclosure in Florida with bankruptcy. If you need to stop HOA foreclosure in Florida contact a Tampa bankruptcy attorney to learn more about how a Chapter 13 may be able to help.
The Automatic Stay
When a debtor (borrower) files for bankruptcy an automatic stay is issued. The stay goes into effect immediately after a Chapter 7 or Chapter 13 bankruptcy is filed. The automatic stay will put an immediate halt and stop HOA foreclosure in Florida. 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.
Eliminate HOA Fees in Bankruptcy
Under bankruptcy law, HOA fees may be discharged in Chapter 7 or Chapter 13 bankruptcy. However, determining the amount that will be discharged requires careful consideration by an experienced bankruptcy lawyer. Generally, HOA fees that have been incurred prior to the order of relief will be eligible for discharge. However, Bankruptcy law will not permit a discharge of HOA fees incurred for any time period after the order for relief has been entered and the debtor still retains either a possessory or legal interest in the property.
If a debt is discharged in bankruptcy the borrower will be released from all personal liability on the debt. The discharge is a permanent court order releasing the borrower from the responsibility of having to pay the debt. Further, the discharge prohibits a creditor from taking any collection action against the borrower.
Using Lien Strip to Stop HOA Foreclosure in Florida
Under Chapter 13 bankruptcy law, junior liens (including mortgages or a homeowner’s association liens) can be stripped or removed from homestead property. 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. Unsecured creditors typically receive nothing or only a small amount of the balance before being discharged. Further, after the discharge is granted, the HOA will be required to remove the lien from the property. For more information about lien stripping contact a bankruptcy lawyer in Tampa.
Stop HOA Foreclosure in Florida with a Chapter 13 Payment Plan
A Chapter 13 bankruptcy filing can permit a homeowner to stop HOA foreclosure in Florida by forcing the HOA to accept a repayment plan over a span of five years. Essentially, the homeowner will have a 60-month loan to repay the back-due HOA fees, regardless if the HOA approves it or not. Most of the time, the interest rate applied to these types of payment plans is around 6%. The rate of interest under a Chapter 13 plan is often less than the rate an HOA may charge. For more information about a specific case or payment plan contact a Tamp bankruptcy lawyer to schedule a consultation.
HOA Foreclosure in Florida Law Firm
If you need to stop HOA foreclosure in Florida contact a Tampa bankruptcy attorney. At Florida Law Advisers, our attorneys are experienced in both bankruptcy and foreclosure defense. Every case to stop HOA foreclosure in Florida and bankruptcy 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 with Chapter 13, Chapter 7, or foreclosure defense our professional legal team will provide you with competent legal advice you can trust. Call us now at 800 990 7763 to speak with a lawyer, we are available to answer your calls 24/7.