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  1. #1
    Join Date
    Aug 2010

    Default May a HOA Use a Collection Agency Instead of Liens

    Like many HOA's, mine in Florida is experiencing increasing difficulty in collection of assessments. As a possible remedy, the Board of Directors is considering hiring a collection agency to help.

    Our controlling documents specify Claim of Lien, Foreclosure, and/or Suit for Money Judgment as remedies for non payment of assessments. They say nothing about other remedies.

    Florida Statute 720.3085 defines required processes for Lien/Foreclosures and limits the mortgagees liability in the case of bank foreclosure. It makes no mention of collection agencies.

    Finally the question. The HOA's attorney, who currently enjoys a monopoly on our collection litigation, says that we can only do what is specified in the DCCR's and the statute, else we could be liable for non-compliance with controlling documents and the statute.

    Is our attorney looking after our best interests, or their own?

    Replies from any Florida HOA's or attorneys would be most appreciated.

  2. #2
    Join Date
    Sep 2005
    Behind a Desk

    Default Re: HOA Use of Collection Agency Illegal in Florida

    If the HOA wants advice from a HOA lawyer, they need to hire one. Actually, it sounds like they already have, so it would make sense for them to follow the advice of their lawyer which presumably means either following the DCCR's or amending them to permit additional actions consistent with the statutes.

  3. #3
    Join Date
    Jan 2007

    Default Re: HOA Use of Collection Agency Illegal in Florida

    720 of FL's statutes limits HOAs to liens and foreclosures thereof for the collection of dues and fines in arrears. 720 also states that in cases of mortgage foreclosure the bank/mortgage company is responsible for 1 years worth of dues or 10% of the outstanding, which ever is less; however, the state 2nd circuit court of appeal has ruled that unenforceable if the mortgage is the first lien.

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