Lueder, Larkin & Hunter, LLC

This past year, community associations have seen an increasing benefit of implementing foreclosure proceedings against delinquent owners. This article describes the foreclosure process and addresses changes in community association law relating to this process.

In 2004, the Georgia legislature amended the Georgia Property Owners’ Association Act (the “POA”) and the Georgia Condominium Act (the “Condo Act”) to permit judicial foreclosures of an association’s lien, subject to superior mortgages or other liens. As a result, associations governed by the Condo Act and POA are no longer required to pay off an owner’s existing mortgage or any other superior liens prior to foreclosure. However, any mortgage or lien that remains in place against the property after the association forecloses will need to be paid off to avoid a subsequent foreclosure by the holder of that mortgage or lien. The POA and the Condo Act were further amended in 2008 to require the amount of the statutory lien to be at least $2,000.00 prior to the initiation of a foreclosure case. This minimum amount can be comprised of assessments, interest, late charges, reasonable attorney’s fees actually incurred that became due within the last four years, and/or fines which were properly imposed as a result of a violation which occurred within the last two years.

Many of us have seen incidents where property damage occurs in a condominium unit, and the owner intends to file a claim against the association’s insurance policy to pay for the damage.  When that happens, the first reaction many of us have is to charge the insurance deductible to the unit owner.  But before you [...]