Article
Courtesy of The Sun Sentinel
By
Joe Kollin
Published
10-19-2006
It
isn't easy telling an elderly widow living on Social Security or a young
laborer with a wife and kids that they must come up with thousands of
dollars in a matter of months or face foreclosure of their homes.
But that's what condo and homeowner association boards throughout South
Florida are telling owners after last year's hurricanes left them facing
huge, unbudgeted bills for repairs and for new insurance, which in some
cases has doubled or tripled.
"We're
getting about a dozen calls a day from frantic owners," said Danille
R. Carroll, the state condo ombudsman. "We tell them there's not
anything they can do but pay the assessment and that they aren't alone,
that associations all over the state are doing the same thing."
While state law requires boards to maintain the value of the community's
common property and keep it insured, owners can petition the board to
change the terms of its assessments. That could mean allowing for longer
repayment or stretching out the time needed for repairs. If that doesn't
work, owners can try to recall board members or file a lawsuit against the
board.
If that fails, owners who can't pay face liens on their property and bills
for their association's legal fees. Ultimately, their homes can be
foreclosed, although no figures are available on how often this is
happening.
Steve Weiss owns a three-bedroom townhouse in the 358-unit Shaker Village
complex in Tamarac. The association's law firm has filed a lien on his
uninhabitable unit because he is having trouble coming up with the $2,500
special assessment.
Hurricane Wilma last October damaged the wiring in his building. Later,
rain damaged the roof and his ceilings collapsed.
Since then, the 45-year-old maintenance worker, his wife, Cherylann, and
their four children, ages 5 to 12, have been living in hotels, paying $60
to $80 a day. He also must pay the $786 insurance and mortgage on the
townhouse, plus $255 a month maintenance.
Even with the special assessment payable over eight months, he hasn't been
able to do it.
"We asked if we could wait and pay the assessment after we moved back
in and didn't have the hotel to worry about, but the association said
no," Weiss said.
Because he hasn't paid, the board turned him over to its law firm for
collection and it accelerated the payments. Although the full amount isn't
due until December, the lawyers since July have been demanding the full
amount immediately.
Weiss said he tried arranging payments, but every time he inquires, the
lawyers add attorney costs to his bill. In July, the lien included
attorney fees of $472; by September it was $839. State law lets condo
lawyers take their fees before turning payments over to associations.
Although the power in Weiss' townhouse is on again and the roof is fixed,
the ceilings haven't been repaired and mold has become a major problem.
The association tells Weiss that he might be able to move back around
Christmas.
Bernice Klayman, president of Weiss' association, said the board needs
almost $900,000 for repairs and insurance. It had to turn delinquents over
to its law firm because "if we didn't, people wouldn't pay, and if
they didn't pay, especially with no late fee on the assessment, how would
we have the money to pay the contractors?"
Association directors, who must also pay the assessments, say they have no
choice but to impose the special assessments. Forcing people to come up
with extra money is never easy.
"You lose a lot of sleep over it," said Joel Leshinsky,
president of the Inverrary Association of Lauderhill, which includes 31
condo and homeowner associations. "You have to make the hard
decisions that enable you to protect everyone while remembering that
you're not talking about doors or walls, you're talking about human
beings.
"It's the crying I can't take from the 80-year-old woman in the
walker who can't pay a $5,000 special assessment. It pulls on your heart,
but you can't let your personal feelings be a factor. It's a tough thing
to do."
Buying a home in a community with an association comes with the
responsibility to maintain the commonly owned property, said Gary
Poliakoff, whose Fort Lauderdale-based law firm represents 4,000
associations in Florida.
"Most unit owners do not appreciate the fact that they might be
exposed to very burdensome common expenses," he said, especially
insurance.
"Forty to 50 percent of the budgets of some associations now are
going for insurance," Poliakoff said. "That's creating an
enormous burden on boards."
Not
every board is having problems.
The directors at the 235-unit Braemar Isle on the east side of the
Intracoastal Waterway in Highland Beach needed almost $1 million. In
March, they imposed an assessment that averages $4,000 per unit, due in
July.
Almost everyone paid, said
manager Mona Texeira, and the association took out a Small Business
Administration loan to cover any extra expenses.
Statewide, boards are using several methods to collect special
assessments. Some are telling owners to get it immediately any way they
can. Others are borrowing money so they can pay expenses while letting
owners pay them back over a longer period. Still others put off repairs
until owners can get money.
State law requires boards to make their decisions in a specific way,
Poliakoff said. In condos, owners must get personal notice of the meeting
at which the special assessment will be considered. Boards must let owners
see books and records with all backup information.
Condo owners who aren't told of the meeting or aren't allowed to see the
books and records should file a complaint with the state Division of
Florida Land Sales, Condominiums & Mobile homes or the condo
ombudsman.
No state agency hears homeowner association complaints, so those owners
must file lawsuits to see the books. The state does not track such suits.
Associations first file a lien against delinquents. If the owner doesn't
pay, they have the option of filing a foreclosure suit.
When such suits are filed, owners can defend themselves in court, and
judges usually try to get the parties to mediate their dispute. But if an
owner loses the case or doesn't respond to the suit, the property is sold
to the highest bidder. The money raised goes to pay the debt, with the
owner getting anything left.
Joan Walter, a widow in her 70s, moved to the 7,200-unit Kings Point in
Delray Beach 30 years ago from Brooklyn, N.Y., with her late husband, an
upholsterer.
Walter's $271 monthly maintenance is going up $71, and the association
just got word that its insurance is increasing $3.2 million for the year.
That will add as much as $132 a month to the great-grandmother's costs.
"I've looked to get out but there is no place [to go]," she
said. "I afforded it very well but I can't keep up with it. All I get
is my late husband's Social Security. You think in old age you'll be
comfortable and then this happens."
Some associations say they can tough it out.
Ron Pacella, president of Hollybrook Golf & Tennis Club in Pembroke
Pines, says his board assessed each owner $1,700.
"Less than 100 of our 1,902 owners are dragging their feet, and if
they don't pay by the end of the year, they will be liened for what they
didn't pay," Pacella said. "Would we foreclose? No, we wouldn't
do that. The lien would remain until they sell."
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