What happens to my homeowner’s association (HOA) dues if I file for bankruptcy?
It depends. If you owe HOA dues from before you filed, they are discharged in the bankruptcy. If you don’t pay the HOA after you file, those dues will not be discharged.
Where it gets confusing for people is when the property is foreclosed. A foreclosure may take many months to complete. Until that foreclosure is completed and title is transferred the dues continue to accrue and all the dues that accumulated after the date of filing the bankruptcy petition remain due and payable by the debtor under the U.S. Bankruptcy Code.
If you are living in the condo until the foreclosure process is completed, you could pay the HOA dues each month and avoid the problem entirely.
If you have surrendered the property in the bankruptcy proceeding, you likely aren’t paying the HOA dues because you have to pay rent somewhere to live.
If you haven’t paid the dues during the bankruptcy will it be a problem for you?
It may not be. This situation often resolves itself in the debtor’s favor because the lender has to clear the title before selling the property. Once the lender pays the dues to clear the title the debt no longer exists. Since the debt claim is based on pre-bankruptcy agreements, which have been discharged, the lender may conclude it has no recourse against the debtor. This means they may not come after you for the HOA dues even though technically you may still owe a portion of them.
For more Bankruptcy H’s see:
- Philadelphia Attorney Kim Coleman says H is for Hardship Discharge
- Downriver, Michigan Attorney, Christopher McAvoy – H is for Harassment by Creditors
- Omaha and Lincoln, Nebraska Attorney, Ryan D. Caldwell – H is for Hearing
- Birmingham Bankruptcy Attorney, Elizabeth Johnson – H is for Hearings
- Christine A. Wilton, Lakewood, CA Lawyer – H is for Hijacking
- Colorado Springs Lawyer Bob Doig – H is for Homestead
- Jacksonville Attorney J. Dinkins G. Grange, Esquire – Home: Can the Trustee Take It?
- San Francisco Attorney, Jeena Cho – Home is Where the Heart Is
- Wisconsin Lawyer, Bret Nason - Honest but Unfortunate Debtor
- Cleveland Area Lawyer, Bill Balena – H is for Honesty
- Philadelphia Suburban Lawyer, Chris Carr – H is for Honesty (and Fraud Avoidance)
- Los Angeles attorney Mark Markus – H is for House and How to Keep it in Bankruptcy
- New York Bankruptcy Attorney Jay S. Fleischman – H is for Household
- Metro Richmond Consumer Attorney Mitchell Goldstein, H is for Household
- Northern California Lawyer Cathy Moran – H is for House
- Los Angeles Attorney, Mark J. Markus – H is for House
- Livonia, Michigan Lawyer, Peter Behrmann – H is for Household Median Income
- Hilo Attorney, Stuart T. Ing – H is for Household Size
- St. Clair Shores Michigan Attorney Kurt OKeefe – H is for How Much is Your Home Worth
Image credit: Leo Reynolds