Stalled Foreclosures Crippling Condo

J.P. from New Haven County, Connecticut writes:

Dear Mister Condo,

Our HOA currently has 4 foreclosures and is on the road to as many as 8. The court system is slow moving and takes forever to judicate the current foreclosures. The other 4 heading down the same road have put a major strain on our current financial picture. Where can the association find the Notice-of-Lien form to send to the owners who are on the threshold of foreclosure?

Mister Condo replies:

J.P., first and foremost, I am sorry to learn of your community’s financial distress. Regardless of cause, foreclosures and lack of financial resources can cripple an entire community; not just those going through the actual foreclosure. I commend your forward thinking and interest in keeping your community fiscally viable.

The court system, for better or worse, is the only system we have for handling foreclosures. In Connecticut, the common interest community has an automatic lien in place for up to six months of common fees and reasonable attorney costs when the unit in foreclosure is finally liquidated. More information is available at the State of Connecticut website – http://ct.gov. I found one interesting article there covering the subject at http://www.cga.ct.gov/2012/rpt/2012-R-0196.htm

If your association can afford an attorney to assist with this process, I highly recommend it. Although your association may incur costs upfront for using the attorney, most of that money should be recovered when the unit is finally resold after foreclosure. Best wishes!