HOA Dues
Posted: Sat May 31, 2008 12:41 pm
Jim,
Jim, here is my analysis:
I ran some research to find a case dealing with the
nondischargeability of HOA dues. I could not find anything. And, so,
here we are once again, collectively, needing to noodle the issue
through and arriving at a consensus! Here is the verbatim statute,
and based upon the literal meaning, it is my position that either
legal, equitable or possessory ownership interest after the order for
relief will gives rise to a nondischargeable debt. Therefore, even if
the debtor moves out before foreclosure, the debtor still has a legal
ownership interest through title to the property, and the post fees
are nondischargeable. It seems equally plausible that if in the
debtor's statement of intention the debtor gives notice to the HOA and
the lender that they intend to surrender possession, and once the
lender is granted relief from stay with the admission that they intend
to foreclosure and the debtor serves the HOA with the relief from stay
motion and order, and the debtor moves out, it may be arguable that
the debtor has relinquished possessory interest with an intent to
surrender legal title to the lender, thereby leaving the lender with
equitable title and the sole liability for HOA fees following the
debtor having moved out after RFS order entered.
(16) for a fee or assessment that becomes due and payable after the
order for relief to a membership association with respect to the
debtor's interest in a unit that has condominium ownership, in a share
of a cooperative corporation, or a lot in a homeowners association,
for as long as the debtor or the trustee has a legal, equitable, or
possessory ownership interest in such unit, such corporation, or such
lot, but nothing in this paragraph shall, except from discharge the
debt of a debtor for a membership association fee or assessment for a
period arising before entry of the order for relief in a pending or
subsequent bankruptcy case.
Back to you, Jim.
Lou
>
> Lou:
>
>
>
> If the debtor decides to stop making payments and the foreclosure
does not occur until 6 or 8 months later due to the delay of the
creditor in affecting foreclosure the fact of moving out is not
sufficient in itself to toll the effects of 523(a)(16). It is either
possession or change in ownership. Any other suggestions on how to
avoid the effects of 523(a)(16) when the debtor just wants to walk away?
>
>
>
> Jim King
>
>
>
Behalf Of Law Offices of Louis J. Esbin
> Sent: Saturday, May 31, 2008 6:27 AM
> To: cdcbaa@yahoogroups.com
> Subject: [cdcbaa] Re: HOA Dues
>
>
>
> I agree with David on both accounts: cannot Quit Claim to someone
> without an effective Delivery; and Delivery means the knowing
> acceptance of the instrument. Attorneys' fees are collectible as to
> the post petition HOA dues, and because HOA is secured, under 506 the
> attorneys' fees are enforceable. My advice to clients is that paying
> the HOA dues post petition is a minimal amount to pay for possession
> while awaiting the final day of dispossession - avoiding unlawful
> detainer judgment as that shows up on a landlord database and makes it
> that much more difficult to rent.
>
> Lou Esbin
>
> --- In cdcbaa@yahoogroups.com ,
"David A. Tilem" wrote:
> >
> > Not sure you can QC the RP to someone against their will.
> > I agree with your conclusion re atty fees.
> >
> >
> > David A. Tilem
> > Certified Bankruptcy Specialist*
> > Law Offices of David A. Tilem (a debt relief agency)
> > 206 N. Jackson Street, #201, Glendale, CA 91206
> > Tel: 818-507-6000 Fax: 818-507-6800
> >
> > * Bankruptcy specialist cert. by State Bar of CA Bd of Legal
> > Specialization.
> > Business bankruptcy specialist cert. by Amer. Bd. of Certification
> > -----Original Message-----
[mailto:cdcbaa@yahoogroups.com ] On
> Behalf Of
> > Nathan Berneman
> > Sent: Friday, May 30, 2008 2:17 PM
> > To: cdcbaa
> > Subject: [cdcbaa] HOA Dues
> >
> >
> >
> > Jim King (who is in Carlsbad with his wife, Mary for her birthday)
and I
> > were discussing HOA fees as it pertains to someone letting go of
> their home.
> >
> > According to 523(a)(16), As long as the debtor, etc. has legal or
> possessory
> > interest in a property, they are responsible for all dues and
> assessments
> > that become due and payable after the order for relief (in other
words,
> > filing of the case).
> >
> > Question No. 1 - Would this amount due also include attorney fees
> after the
> > filing for the HOA attys. trying to collect the debt? We think it
> does but
> > wanted to see if anyone had any experiences with this yet.
> >
> > Question No. 2 from Jim - What about quitclaiming the property to
> the HOA
> > before you file so that way, you don't have technical ownership in the
> > property becuase title is not in your name and they cannot charge
> you the
> > HOA fees, etc. that come due after the case was filed.
> >
> > Thank you in advance for any input.
> >
> > Nate Berneman
> >
>
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