Some people that own North Scottsdale real estate, or any home in the metro-Phoenix area, are struggling to make their mortgage payments. As they negotiate with their lender(s) to obtain a loan modification or short sale they sometimes stop making their payments to them. With that they also stop making their HOA payments. Even if they work out a deal with their lender(s) they could still lose their home.
CNBC posted an article toady talking about a new wave of foreclosures. These foreclosures aren’t coming from the mortgage companies; rather they are from the Homeowners Associations (HOA). Arizona is one of 34 states that allow for judicial foreclosures by HOAs. They have the right to do so through the Arizona Planned Community Act and Condominium Act. This video explains how your HOA could sell your property from under you and what you can do about it. We are not attorneys. We advise you to consult with an Attorney before making any decision.
What is your opinion of Homeowners Associations and their rights to foreclose on your property? Leave a comment below and let us know or email us at MyOpinion@ThePrecisionTeam.com
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Where does the government get the money to bail out the banks and consumer? Print more money? How about this…no bailouts, if someone can’t make the payments how about an incentive to convert 30 yr mortgages to 60 yr mortgages. That would make housing affordable to those that cannot afford it
Banks should be able to pursue deficiencies. If you lent me the money, wouldn’t you want it back?
Your “solution” would simply continue the policies that got us into this mess. But I forgot, you are biased as a realtor, you would want consumerism to continue…I’m just sayin.
Paul, Thank you for your comment. We appreciate your input.
The government has gotten money to bail out the banks by borrowing from investors and other countries. Printing more money would create a massive inflation problem and they do not do that. Instead they sell treasury bonds, and the like, to raise extra money.
I think your idea of converting notes from 30 yr to 60 yr repayment plans is interesting. I think one of the challenges in that is that very few people keep a home for the full 30 year term. 60 years is even more unrealistic. For anyone over 30, that means they will be making payments on their home until they are over 90! On a 60 year amortization the amount of principal being paid would be so little it will take them an unreasonable amount of time to build any equity, since they are starting so far in the hole as it is thanks to the massive drop in home values. So if any of those individuals experienced a job loss, or have to move for some reason, they would be put right back in the predicament they are in now… not being able to afford their note and not being able to sell their home because they owe too much on it. I would prefer to see a solution that deals with ending this problem immediate rather than potentially dragging it out. Again, it’s an interesting idea, because in theory it would allow a lot of people to continue to live in their home for an affordable payment; but the problem is when they face a situation where they absolutely have to sell.
I’m assuming your reference to my “solution” is specific to my blog entitled “My Solution to the housing crisis”.
My “solution” would not call for it to be illegal for the lenders to collect deficiencies (in anti-deficiency states like Arizona it already is on primary residences); it would simply give them an incentive to waive that right. For the banks, it is a bottom line dollar amount. Just because they can go after someone for deficiencies, doesn’t mean they will actually collect all of it, or any. Most people who get pursued negotiate a settlement or declare bankruptcy. With my solution the banks would recover ½ of the deficiency across the board. That is way more than they are recovering currently.
Further more my “solution” is different than the “policies that got us into this mess” because it would call for the homeowners to pay back every penny they borrow to make this ½ deficiency payment in a very affordable way. They would pay this back on a long term (similar to your suggestion) low interest note. The policies that got us into this mess were to give unqualified people loans that they could not afford. Even as a biased realtor, I am a all for the end of that practice. It doesn’t do me any good in the long run and it certainly doesn’t do America as a whole any good.
I would like to point out that even in this down market where getting a mortgage is tougher there are still plenty of home sales to keep me as a realtor doing well. Consumerism will continue with or without my solution. I think with my solution, we would see a faster recovery for everyone, not just my real estate business.
Again, thank you for your comment.
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