I Owe What?!

Posted by Howard Flaschen on Sunday, July 18th, 2010 at 7:59am.

Renters to Pick Up the Slack on HOA Dues?

New Law Effects Renters For Delinquent Landlords

Those who rent face a new threat of eviction now that a Florida law allows HOAs to go after renters, not just landlords, forend_of_the_road_825 delinquent dues and fees. Thus the old days of simply writing a check to your landlord and assuming the 'bills' were paid are long over, if you didn't know that already.

Should the owner fall behind on their HOA dues and the renter doesn't pick them up, the renter now faces the cloud of eviction. In the past, HOAs could and would place liens on property but eviction of the renter for this wasn't in the cards.

Up until now, tenants paid only their rent to their landlords, who were then supposed to pay any fixed expenses like community fees, insurance, etc. If they failed to pay those fees, a homeowner or condo association then could file a lien or ask a judge for the title to the property however both took time and had high costs that were difficult for cash strapped associations to pay. The downturn in housing has been felt by HOAs nationwide and is evident simply by driving through some of the communities in Florida, Arizona, and California more specifically.

The July 1st law allows homeowner or condo associations to collect directly from renters if their landlords don't pay their due. This is a new wrinkle in the renter-landlord relationship and the HOAs feel justified in having a new avenue to collect what is due them as renters get the benefits of the community's amenities.

Investor-owners who have chosen to walk away from their investment also stop paying their association fees. The Strategic Default trend, coupled with the increase in the unemployed residents who can't afford fees, have made it a challenge for homeowner and condo associations to maintain amenities.

The new law attempts to ease financial problems for H/COAs, but doubts linger about its implementation.

Many associations may have trouble assessing renters because no one necessarily tracks who is renting their properties out and how much the renters are paying.

It will be interesting to see just how this is executed and how the courts weigh in.

Howard Flaschen

REALTOR / CDPE

904-237-5311

Howard@RoundTableRealty.com

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