Category Archives: Collections

Court rules that Michigan HOA cannot collect assessments after restrictive covenant expires

In Deghetto v Beaumont’s Seven Harbors White and Duck Lack Association, issued June 22, 2017 (Docket No. 330972) (Unpublished Opinion), the Michigan Court of Appeals recently ruled that a homeowners’ association could not continue to collect assessments after the restrictive covenant expired. In Deghetto, the plaintiffs were the owners of multiple lots in six separate subdivisions in Highland Township, Michigan

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Does a Successor Developer Have an Obligation to Pay Assessments under the Michigan Condominium Act?

The recent upswing in the real estate market has led to a resurgence of failed condominium projects in Michigan. During the economic downturn, many condominium developers went out of business and lost title to all of their units via a deed in lieu of foreclosure, foreclosure by a bank, tax foreclosure or bankruptcy leaving many condominiums unfinished.  As a result,

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Encouraging Lenders to Foreclose: Don’t let your Condominium and HOA units sit vacant without collecting assessments

Even though the real estate market is gradually improving, condominium and homeowner communities are still faced with instances where a delinquent member abandons their unit/home and stops mortgage payments, but the lender does not foreclose.   While condominium associations often believe they are “stuck” in these types of situations as the unit/home owner is uncollectable, and the lender will not foreclose,

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A Co-owner Filed Bankruptcy, What Now?

    Condominium associations are solely dependent upon the collection of assessments from its members for their survival and to purchase and provide the goods and services necessary for the maintenance of the project for the benefit of its members.  Thus, when a Co-owner files bankruptcy, there is an understandable feeling that all is lost.  However, that is not always

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MICHIGAN COURT OF APPEALS RULES THAT CONDOMINIUM ASSOCIATION IS NOT ENTITLED TO NOTICE OF SURPLUS FUNDS FROM FORECLOSURE SALE

In Moon Lake Condominium Association v RBS Citizens, Case No. 323476 (Michigan Court of Appeals, November 12, 2015, unpublished), the Michigan Court of Appeals held that junior lienholders, such as condominium associations, are not entitled to notice that surplus funds were collected from a foreclosure sale after the first mortgage of record was foreclosed on.  At issue in this case

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Which Type of Foreclosure, Judicial or Advertisement, is Best for Your Condominium Association?

Condominium associations are often faced with delinquent co-owners.  Unfortunately, the days are long gone when a Condominium Association is guaranteed to recoup all of the delinquent assessments plus attorney fees and costs from a sheriff sale of the condominium unit.  However, there are times when a Condominium Association should proceed to foreclose on its lien. The Michigan Condominium Act, MCL

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