Do you have tenants residing in your association where the owner is delinquent on Association Maintenance Fees, Late Fees, Interest or Special Assessments? Attorneys have tools to collect rent directly from the Renter and then apply the rents toward the delinquent amounts due to the Condominium or Homeowner’s Association.
With the Law Offices of Rajtar and Associates, P.A., we help associations with Delinquent Owners who receive money from their tenants, but as the Owners may have financial difficulty, or indeed, may be facing foreclosure, the Owner pockets the Rent; yet, the Association is left out in the cold as the Owner pockets the monies and doesn’t pay the association. Why would they? They know the bank is going to be getting the unit so they grab everything while they can. Here’s how the involvement of a law firm can help you:
The attorney requests the local court appoint a Receiver designated ONLY to collect rents from delinquent owners and/or their tenants. A receiver can be given permission by the Court to collect monies from all delinquent owners, even if the unit becomes delinquent at a later date. If the Owner does not pay, the Tenant is then brought into the picture.
The Tenant is notified they must now pay all rent monies to the Receiver. When the Receiver collects the rent, he disburses the funds to the Association’s attorneys. The attorneys then disburse the funds to the Association. The total turn-around time for payment of funds is usually less than 60 days.
If the tenant does not pay the rent to the Receiver, or if the Owner continues to accept rent, a request can be made to the Court that the offending party be held in Contempt. A Contempt Order could lead to the Renter and/or Owner be incarcerated for their failure to comply with Court Orders.
Renters are then faced with three choices, pay the rent to the Receiver, be evicted by the Receiver, or be held in Contempt. The Receiver can be granted the full authority by the Court that the Unit Owner has, i.e. he can re-rent and/or evict tenants from the unit. The big difference to the Association is the Receiver actually pays the Delinquent Assessments due to the Association.
After all the Delinquent Assessments, Attorney Fees, and Costs are paid by the unit owner, the Receiver no longer is in the equation, so it makes more sense for the unit owner to pay up the back monies due the association immediately if the Unit Owner wishes to have the continuing income. If the Owner becomes late again, of course, the operation of the Receiver again comes into play.
There is absolutely no loss of control by the Association; the receiver works with the Association to collect all the monies due from the Delinquent Unit Owners. The Receiver’s participation is limited to the collection from Delinquent Owners on the Association’s behalf.
With hundreds of thousands of foreclosures going on in South Florida, an Association shouldn’t continue to have Owners collecting rents without paying their assessments. In fact, an Association or its Board of Directors could be held liable for not doing everything possible to collect assessments when due when it is their fiduciary responsibility to do so. This is especially true as the other Owners will have to make up the short-fall for the Owners who do not pay their assessments on time.
