[TowerTalk] Re: OT: HOA's

[Tom Anderson]

http://www.dallasnews.com/localnews/stories/040803dnmethomeowners.a8fd6.html
 
 Fellow Tower Talkians:
 
 Some TT members were having trouble getting the above link on a story
about homeowner's associations to show up on line, so I copied it in
text form and am sending it here, hope no one minds the lengthy e-mail. 
Even the "printer friendly" version would just show gibberish, so here
it is in case you had trouble reading it.  The story is copyrighted in
Wednesday's Dallas Morning News on the front page of their Metropolitan
(Local News) Section for those of you in the Dallas/Fort Worth area.

Tom, WW5L
Colleyville TX


Bill seeks to rein in homeowners groups 

Judicial limits proposed on power to foreclose for unpaid dues

04/08/2003 

By ROY APPLETON / The Dallas Morning News 

Texas homeowners associations, those proliferating tools for
neighborhood protection and control, are
trying to preserve their ultimate weapon – the power to put their
debtors' homes up for sale. 

Across the state, and increasingly so in the Dallas area, the private
groups use the threat of foreclosure –
and the occasional auction of property – to get homeowners' attention
and extract delinquent dues. 

"Foreclosure is a last resort," said Kim Perry, president of the Dallas
area's largest property association at
Stonebridge Ranch in McKinney. "But it is the only stick we have to
ensure that everybody pays." 

A bill before the Senate Intergovernmental Relations Committee Wednesday
would require property
associations to obtain a court order before auctioning a person's house
– an extra step rarely taken in and
around Dallas County. 

Associations are fighting the measure, which also would limit their use
of attorneys, apply open records
and meetings laws to the groups and, as it now stands, limit
foreclosures to debts at least a year old. The
bill excludes condominiums. 

"This is the largest threat to the viability of homeowners associations
that we've seen," said David Smith,
legislative coordinator for Dallas-based Texas Neighborhoods Together
and its more than 1,000
associations. 

Judicial oversight would increase the time and cost of debt collections,
which would inhibit some groups
from taking action, Mr. Smith said. It would force associations to raise
dues and delay upkeep, he said. 

Supporters of the bill say court review is important to ensure fairness. 

"Having the impartial involvement of a judge is worth the cost," said
Rob Edwards, an aide to state Sen.
Jon Lindsay, R-Houston, who introduced the measure. "This is not about
killing associations. We're just
trying to be reasonable." 

Foreclosure threat 

The foreclosure stick has long raised an outcry in the Houston area,
where critics have counted more than
15,000 association filings from 1985 through 2001. 

It's also being brandished more frequently in the Dallas area, where 92
people lost their homes last year
for association debts typically ranging from $500 to $1,000, said George
Roddy, president of Foreclosure
Listing Service. And 30 properties were auctioned this year through
February. 

Association lawyers typically send collection letters to homeowners
owing dues – and if necessary add
their property to the monthly sale at county courthouses. The debtors
usually pay up. 

That's what Don Paolello did earlier this year in Arlington. He owed
Creekside Park Residential
Association $350 in past dues, ignored collection letters and found his
home on the auction block in
January. 

"I can't believe they have the right to do that," said Mr. Paolello, who
paid nearly $1,500 – including legal
fees – to retain his home. 

Nearly 50 million Americans live in more than 250,000 property
associations, according to the
Virginia-based Community Associations Institute. The number keeps
growing as more cities require that
new subdivisions with shared amenities have these groups to cover
upkeep. Mandatory dues fund the
work. 

Associations also enforce deed restrictions and other land-use rules
that members approve. They play
important roles in protecting neighborhoods and property values,
supporters and critics agree. 

Foreclosure has been used to address unpaid dues since 1987, when a
divided Texas Supreme Court
decided that the mandatory assessments on each property in an
association were in effect a contract and
overrode the state's constitutional homestead exemption. The exemption
protects homes from forced sale
for debts other than taxes, purchase loans and construction
improvements. 

"There's no way ... [a homeowners association] should be able to
foreclose on your home," said Harvella
Jones, whose Texas Homeowners Advocate Group believes the actions are
unconstitutional. For now, she
is supporting Mr. Lindsay's bill. 

772 homes auctioned 

Last year at least 772 houses, townhomes and condominiums in Collin,
Dallas, Tarrant, Denton and
Rockwall counties were posted for auction – up from 592 in 2001 and 406
the year before, according to
Mr. Roddy. 

The increase in association foreclosure listings tracks Dallas-area
postings by mortgage lenders and is
"relative to the economy and [loss of] jobs," Mr. Roddy said. 

"All you have to do is look at the local economy," said Ms. Perry, whose
6,200-home Stonebridge Ranch
association led the five-county area with foreclosure filings last year
with 50 postings. Only one of those
ended in a forced sale. 

Stonebridge provides 290 acres of swimming pools, lakes and open space.
Dues are $586 annually, and
the association offers payment plans for those struggling to pay and
typically doesn't pursue foreclosure
until about $1,000 is owed, Ms. Perry said. 

Critics say some associations are too inflexible and too often driven by
attorneys and property
management companies that benefit financially from collections. 

"Good homeowners associations will work with you, but unfortunately some
of them can be incredibly
aggressive," said David Kahne, a lawyer and longtime critic of
associations around Houston. "The bank
will work with you, your doctor will work with you, the credit card
company will work with you. If you
lose your job, if your kid gets sick, if you become disabled, you
shouldn't lose your home." 

People buy into an association's rules and dues when they buy into its
world. And they can live with the
requirements, work to change them or move, said Ken Nelson, a Plano
resident and president of Texas
Neighborhoods Together. 

"Most people are satisfied with what's going on," he said. 

Not Marty Carpenter, who has fought with Deerfield Homeowners
Association in Plano over his fence
and has questioned $500 fines being levied against others for burned-out
mailbox lights. 

"You get a group of people with not enough to do, and if you stand up to
them it's like a colony of ants,"
he said. 

E-mail rappleton at dallasnews.com 


Online at:
http://www.dallasnews.com/localnews/stories/040803dnmethomeowners.a8fd6.htm