Post by Admin on Oct 6, 2019 10:27:20 GMT -5
I was curious as to the current status of account delinquency in SLohA. I wondered if the legal fees involved in the collection of accounts was justified by the payoff in curing the delinquencies. So, I tuned into the public record to get a rundown of Liens to compare it to what SLohA has spent so far this fiscal year in Lien/Foreclosure/General Representation legal costs. Everything here came from a public record and SLohA Financial reports and where I don't know or am guessing, I state that.
This is what I found. The activity TODAY comes from lien collection actions begun in 2018 as well as 2019.
There have been 16 Claims of Lien; the earliest filed in Aug 2018. It doesn't cost much to file a claim of Lien. Recording fee $15. Someone with a calculator has to figure out how much in past fees are owed, add whatever interest and late fees and then the attorney adds a legal fee. Each owner gets a copy of the lien mailed out. The total of the liens as of their filing dates >>>$54,502. (The liens continues from the filing date ie SLohA does not have to keep filing new liens with additional assessments added.)
The average of the liens was $3,406 or about 6 1/2 quarterly delinquent payments. There is a great variation in the liens filed from a Low of $1,199 to $5,138. When a lien is filed, the collection costs are added to the delinquent assessment amount.
Total paid back to SLohA is $26,737 on SIX Liens, one of which went to Lis Pendens (foreclosure suit). The Lis Pendens is a judicial action of foreclosure and requires a lot more time and expense to file, but that is typically captured when the Lien and associated costs to collect are satisfied.
Of the remaining 10 Liens currently on record, there is a mixed bag of "situations". One is probably an unsettled probate situation and that one was over $5,000 in 2018.
One lien was contested and SLohA lost its claim. This was concerning a Tax Deed. THAT was very expensive, as usually the "loser" has to pay all the "winners" attorney fees and costs (32 SLN). This adjudication happened in September 2019. If you are interested in details, it is in the public record but my guess is that S-bag is at least $20,000 out of pocket on this one.
There is another similar case--in circumstance having to do with Tax Deeds--that may or may not file a complaint against SLohA for Quiet Title (10SBT). Hopefully, that will not happen.
Of the remaining 8 liens, 4 have a Lis Pendens filed in court and are in the foreclosure process. One of those foreclosure suits MAY have been answered by the Owner, as the financial shows a $600 retainer fee for attorney attention to 22GH. Guessing here.
One of the remaining 4 liens (91SS) seems to have a situation in that the property was sold 6 months prior to S-bag filing the lien (sold 3/18) and Lien filed 10/18. It is referenced in the April 2019 with a Lien/Foreclosure expense so it is hard to tell what is going on. Are the new owners responsible to pay the past due assessment fees of the previous owner?
The remaining 3 liens are more currently filed (Jan 2019) and presumably in the maturing process and eventually either be paid or foreclosed.
Through July 2019, SLohA has spent $20,658 in legal fees. The budget reflects a "refresher retainer" of $4000 and a new retainer of $600 referenced to lien on 22GH. If we remove the general retainer "refresher" from the total, it leaves $16,658 in Lien and Foreclosure fees (presumtively). Some of those expenditures may not be specifically related to Lien/Foreclosure legal and collection activity.
It is unknown what additional legal business SLohA has other than collections that would come under "General Representation". I would hope that there would be some legal activity related to the KCNetwork shenanigans but that is just a wish and cannot be determined from the records available to owners without an official request (which I do not intend to make).
S-bag additionally assumes the potential liability of a lawsuit by an owner who will complain that S-bag does not have Declaration foreclosure authority (which it clearly does not and has previously--unsuccessfully--tried to add this authority by amendment proposal).
I leave it to readers to assess the relative value of the legal cost versus recouped monies. Filing anything in the system can result in unintended (and costly) consequences. The value might not be financially beneficial in the short run, but a necessary compliance tool to assure owners do not lapse in assessments.
What do you think?