Collection of assessments is one of the biggest headaches for many Community Associations. Most of the time, collections follow a standard process. It might be slow and take several steps. But, since assessments are liens on the unit and since an Association can collect all of its attorneys’ fees and costs, an Association can collect all of its assessments most of the time.
However, when a Unit Owner files for Bankruptcy, the collection process changes.
Collecting Unpaid Assessments during a Bankruptcy
I have worked with a number of Associations who thought that once a Unit Owner filed for Bankruptcy, they had to write off all of their uncollected assessments.
I also have seen plenty of others do nothing while the Bankruptcy process lumbers on. This just makes the already large delinquency even bigger.
Associations can collect unpaid assessments when a Unit Owner is in Bankruptcy.
Continue Reading Condominiums, Homeowners’ Associations and Bankruptcy: How Does a Unit Owner Bankruptcy Affect Collections?