Delinquent condo owners face public shaming
From posting a list of homeowners delinquent on their maintenance fees to restricting their access to complex amenities, members of one Florida community draw a line in the sand as foreclosure woes abound.
Few things agitate Sid Schulman, who often shoots the breeze with other retirees and flirts with female friends at their condominium complex in Lauderhill, Fla.
But it galls him when neighbors stop paying their mortgages and maintenance fees and leave the cost of community upkeep to others. (Bing: What's the average cost of homeowner-association fees?)
"I am paying for these guys," says the 75-year-old, sitting poolside, a diamond stud in his left ear.
In 2009, he took matters into his own hands. Near the mailbox of each condo building, he posted a list of residents who were delinquent on their maintenance fees, with the message "Pay up or move out" in English and in Spanish. He also tried, unsuccessfully, to get the cable company to cut off service to nonpayers.
The public shaming angered some of those named.
"You know where I live — come and tell me that to me face," says Lorena Garcia, 36, who lost her job and ability to pay.
The storm that struck the housing market has strewn many casualties: lenders, builders, real-estate agents and mortgage-bond investors. Add to the list the comity of certain communities where residents live close together, some of them paying their mortgages and homeowners-association fees and some not.
As banks slow foreclosures amid concerns about sloppy record-keeping, some delinquent homeowners get to stay put even longer without paying. The delays are inflaming some neighbors who consider that unfair.
The condo complex Schulman and Garcia share, called International Village, has installed a fingerprint-scanning device at its central clubhouse. The scanner keeps residents who are more than 90 days behind on their maintenance fees from swimming in the pools, playing on the racquetball courts and using the game room, which plays host to canasta and mah-jongg competitions.
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In a stark example of housing tensions elsewhere, the International Village homeowners association responded to the banks' foreclosure slowdown with an aggressive step: It began its own foreclosures. Florida law permits that under certain circumstances. A nonprofit homeowners association can take temporary title of residential units from people who aren't paying monthly fees that they agreed to pay.
Dip in value fuels tensions
The scene of these frictions is a 28-acre community in southeastern Florida's Broward County that spreads out on a peninsula, surrounded by a canal, a lake and an 8-foot stone wall. Oak trees shade the gated entrance to International Village, at the center of which is the Bavarian clubhouse, built with a 24-foot ceiling and stone fireplace. Three-story residential buildings, each with about 76 condos, are grouped according to their architectural roots, bearing names such as Yorkshire and Bordeaux. In the morning, residents gather at the pool for "aquacise."
Early marketing brochures for the complex, built in the 1970s, lured well-off retirees and snowbirds by promising "seventh heaven for people who insist on living first class."
Easy lending during the housing boom put the condos within reach of lower-income buyers. Michael Schenkel, a real-estate professional who owns three units in the complex and manages others, says that average prices for its one-bedroom condos peaked at about $120,000 in 2006.
- MSN Money: Foreclosures at rock-bottom prices
Then Florida's sagging economy started costing residents their livelihoods and ability to pay. Garcia bought a two-bedroom condo in International Village in 2005 for $190,000, but she lost her job. With her cash dwindling as she went through a divorce, she says, she stopped making her $1,500 monthly mortgage payments in 2008.
Special assessments pushed up the monthly maintenance fee she owed to the homeowners association. Garcia didn't pay that, either.
Now, owners of about 128 of the 832 units at International Village, a little more than 15%, are at least 90 days behind on their fees. Banks won't lend on residences in the complex until these delinquencies drop below 15%, Schenkel says.
- On our blog, 'Listed': January's foreclosure dip may not be good news
The problems feed on themselves: "Banks will not write mortgages in communities with high delinquencies," he says, "and property values will not increase until we get financing from major banks." Schenkel says the value of one-bedroom units has tumbled as much as 75%.
With the homeowners association unable to collect maintenance from so many units, the complex is showing the wear: torn screen doors, roofs needing repair, carpets getting shabby. In 2010, the total of delinquent fees passed $1 million, equal to one-third of the association's annual budget.
"The foreclosure process takes over two years," Schenkel says. "You can get away with living for free for two years, not paying mortgage and maintenance."
Larry Kornblith, 82, takes a dim view of that.
"The ones who are delinquent are parasites," he says. "If you can't afford it, get out."
Residents who are current on their payments also disagree on how the homeowners association should deal with those who aren't current.
Doug Meyers, a resident and association board member who owns more than a dozen units and is up-to-date on his payments, voted against installing the fingerprint scanner. He was skeptical it would work. He says some neighbors accused him of protecting residents who were delinquent.
"They make it personal. It bothers me, personally. It hurts me," says Meyers, 54, adding that he now tries to avoid some fellow residents.
Others wanted the association to get tougher. Among these was Michele Tersigni, a 53-year-old resident who works as an administrator at a doctor's office. She won a seat on the homeowners-association board in early 2010 and became its president in May.
She quickly made changes, such as hiring security guards directly instead of through a service, to save money. Responding to residents' complaints about people staying in homes they were no longer paying for, she hired new lawyers who would be more aggressive.
The Condo maintenance fees were paid faithfully every month along with any assessments. Take a look at my first video of what happened to me at Granger Lake Condo #1 Association in Medina, OH. More videos to come. I am now Homeless due to what happened at my Condo I purchased with cash. These actions are Criminal and need Federal Investigation which I am working on initiating. Join the efforts and report such happenings to your US Congressman.
The Channel of MsYouWho7 if you cannot get the address to work. Remember the address IS CASE SENSITIVE.
Pass it on..................Thanks.
I understand where you are coming from and normally I would agree with you but, there are a lot of good, hard working citizens who are on public assistance right now. They either can't find jobs or they have had to accept jobs that don't pay the bills. Most of these people are embarrassed and ashamed enough without other people ridiculing them. Don't get me wrong I am not supporting any of those dead beats out there that want to live on our tax dollars.
In this economy many people are struggling, and I feel sorry for them, but cutting back on "paid" conveniences such a pool etc, is a perfect way for the landowner to say, he's cutting back too. He's cutting back on his maintenance that he has to pay for upkeep. Good on him.
I don't care if you are humiliated. If you can't or won't pay your mortgage, get out! How you can be gutsy enough to not pay your bills, be mad that your mortgage paying neighbors are upset because you won't, AND expect to have access to the amenities YOU won't pay for is beyond me.
By you mentioning Clinton and Democrat I am assuming that you are Rrepublican and or assuming that I am Democrat. Bush and his advisors could have stopped the bleeding with forsight. You are correct that Clinton was pressured by big business to deregulate the financial system so that goes to both parties mistake and I am certain that both parties profitted or and thier buddies.
So I think we can agree on that.......now was it wrong by Obama to ask the banks to start lending when he came into office. We can loan you money (banks) but you will not loan the American people money under normal qualifications but rather having to meet new restricted qualifications.
Maybe I should not say "Bush" but rather Bush and his advisors. You should not give away that kind of tax payer money without looking at the big picture. I bet none of those big bankers had to give up the mansions or the Ferrari, and no I am not claiming that all those big bankers are all Republicans.
I can care less about either party; I see them both as two big fraternities that have no idea what its like to be the avergare Joe. I have no "party" loyalty.....some people can't get beyond the party and look at what's right or makes sense. I think we all want the same thing but don't realize that the "parties" keep us from acheiving it.
This is not necessarily true. It some cases you are right on button in some cases you are not. One of my clients supplied building material for homes/construction. They had over 300 employee's I watched over a 1 year period that business went under. All this was tied to the foreclosure and no new construction going on.
Those 300 people may have been making a decent wages, now think chances are many are not college educated......where do you replace that income in a job strapped economy. I had another client who had many employee's making 60 to 70 thousand a year doing blue collar work and I know for a fact that many were high school educated only, and once they started working there would never leave because there was no way they could match that salary. Now making that money for 10 to 20 years, you would have bought a house and tensd think you weould be ok. 1 year later you are laid off with no possible way of replacing that income. Its hard for college graduates to get 60 to 70 a year now take a guy in his 40's with no other skills other than the what he learned on the job repeating the same task all day and have him have to fight in this job market with no computer skills or any other real marketable skills.
The blue collar workers are catching it the most.
LKESSLER41: Don't get me wrong, but that's called not planning ahead. People bought way too much house with money that they did have and that previously could not afford a basic home. Whatever made you think you could afford a condo and amenities, well, give the thanks for that to Uncle Obama... He made it incredibly easy for a lot of first time homebuyers two years ago to buy what they couldn't afford by telling lenders: "hey, ease the rules." This is the result.
The bank bailout happened under Bush. He signed it on his way out of office.
This free for all lending happened under Bush administration not that he had anything to do with it. The banking industry lowered their own requirements for greed and knew that they would not be allowed to fail because of how they were tied into everything. They were bailed out and kept the money until they built up their pockets again. The bailout was supposed to help the banks and help the people but it only helped the banks because they stopped lending. Basically the whole industry got fat off of these dealings and now tax payers are paying this this. Obama had to ask for the banks to lower their "NEW" requirements because if the money just sits in the bank, how is that helping the economy? banks have gotten all their money back and still holding people hostage to foreclosure.
Like I sais before, if "BUSH" would have tied this bailout to 5.5% interest across the board then we would have avoided all of this. If I can think of this I am certain that those lawyers and economists in the WH could have figured this out. It was all about re-upping the pocket book. I blame Bush because he signed it but I am certain that it wasn't only Republicans profiting.... it had to be an agreed upon plan by big business and both parties accepted it.
So Basically ...no Obama had nothing to do with this constipated banking system, he just tried to add a little enema.