7th Jul 2017
Image: Unspash / Redd Angelo
Many people in the Houston area have issues with their homeowner’s associations. These associations can require you to pay annual assessments in order to live in the neighborhood. If you do not make these assessments, they have the right to file a lawsuit against you and receive court permission to foreclose on your house. Once they receive the court order granting them permission, they will schedule the house for foreclosure on the next available first Tuesday of the month where the house will be auctioned off in order to satisfy the assessment in addition to their attorney’s fees.
If you are behind in your association dues, you can file a Chapter 13 bankruptcy to stop a pending foreclosure and put the money that is owed to them in a 3 to 5 year payment plan where they will receive interest on the amount owed to them and paid out slowly over that time period. This will allow you some breathing room as well as stop their threatening phone calls and letters. HOA attorney’s fees tend to add up quickly so the sooner you file, the smaller that their fees will be.
In some cases, you may be able to strip the homeowner’s association fees from the house and discharge the debt owed to them. If you have no equity in your house, you have the right in Chapter 13 to strip their lien from the house and discharge the debt. Thus, if your house is worth $100,000.00 and you owe the mortgage company $115,000.00 in addition to another $5,000.00 to the homeowner’s association, there is no equity in the house for their lien to attach. Thus, their $5,000.00 becomes unsecured and we can strip their lien and discharge their debt so you do not have to pay it. You will still be responsible, however, to pay for any future assessments that are placed on the house following the filing of your case.
While you are in bankruptcy, the HOA cannot try to collect against you. This means that you can still enjoy the use of the clubhouse, the pool and other neighborhood activities just as if you had paid them and never filed.
If you would like to discuss these issues further, I offer a free, no obligation consultation to review your situation and answer your individual questions. Please contact me at 281-847-4345 or firstname.lastname@example.org so we can discuss your individual situation and see if Chapter 13 would work for you and how we can help you set up a plan to pay the required fees. The consultation is free. Take the first step by calling me today. I look forward to hearing from you soon.