Am I responsible for previous owner's overdue fees?


#1

I acquired a townhouse through an auction (trustee sale). The management company is billing me for what the previous owner did not pay. Am I responsible? If NOT how do I defend myself? (Any state laws, or regulations that free me from this responsiblity?)


#2

It is my belief that you are not responsible, however, I have had nothing but trouble dealing with these management companies. If the bill isn’t too large it may be easier just to pay.


#3

The bill is not small.? What can be a strong argument to defend myself?


#4

Foreclosure removes any debt that was secured against the property and incurred after the original date of the deed of trust (loan) with the sole exception of property taxes. As the fees were likely incurred after the original loan date they no longer have a claim against the property. Any hoa fees incurred after the date you purchased the property at foreclosure would likely be secured by the property. Be sure you DO pay the prorated portion of the fees you do owe. The problem I’ve had is in convincing these yahoo’s of this without involving a lawyer. You might poke around: http://www.ahrc.com - you may find somewhere there is more familiar with HOA law.


#5

Just talked with foreclosure expert Larry Blachman and he tells me that they can be senior IF, and ONLY if, it is stated in the CC&R’s. The theory here is that the CC&R’s are recorded before the loan, and therefore their lien is senior to subsequent financing. Note that this is rare, so definitely check the CC&R’s.