Whether you ultimately end up choosing to file foreclosure or not, we strongly advise that you follow Florida’s NLA-NOIL-Lien-NOIF process on any delinquent account. As of July 1, 2021, the initial step is for the association to send a Notice of Late Assessment (NLA). In accordance with SB56 this notice is to be sent by regular mail to the property, to provide an opportunity to pay the delinquent balance without any attorney costs added. The next step is to send a Notice of Intent to Lien (NOIL) letter. This is required by statute and provides a 45-day window for the owner to bring their balance current. If they do not get the account paid, the association can record a claim of lien against the unit in the county’s official records at the expiration of that 45-day time period. We then send a Notice of Intent to Foreclose (NOIF) letter. This is another statutorily required letter which provides a final window of 45 days to get the account paid. If no payment arrangements are made by that time, the association has the right to file a lawsuit to foreclose the lien. This ultimately results in the property being put to auction by the court similar to a mortgage foreclosure. The association’s lien foreclosure can extinguish all interests against the property except for a first mortgage.

Having said that, the vast majority of lien foreclosure lawsuits get resolved before they ever get to auction. Most owners will not allow themselves to lose their property over the usually somewhat small HOA balance. Sadly, the filing of the FC suit is the last piece of leverage that finally gets them to realize they can’t run from this and they pay. If they don’t, however, then the association gets a credit bid at the FC auction for the entire amount they are owed. This includes all back assessments, interest and late fees if applicable, as well as all associated attorney fees and hard costs related to the collections work and lawsuit (when we have a successful collection, the final cost to the association is zero as everything is recouped from the owner). At the auction, if a 3rd party bids higher than what we are owed (which is quite common), then they take title to the unit and we are paid in full. That is the homerun result we hope for. If no one bids at the foreclosure auction, then the association takes title to the unit. From there, generally the game plan would be to rent the unit out for as long as possible until the bank/mortgagee forecloses on top of us at some point down the road. We have seen associations not only recoup their money owed through this rental process, but sometimes even obtain a windfall. If there is no mortgage, then an owner is surely not going to allow the property to be foreclosed for the smaller amount the HOA is owed. If that did happen though, that means whoever got title at the auction would own it ‘free and clear’ and could sell it for full value. Again, the vast majority of files we initiate lien foreclosure on settle before the FC suit finalizes; and the times we do get the auction, the majority of the time we get paid off by a 3rd party bidder.

It is important to note that, while we have great success with lien foreclosures and they are a necessary tool in the arsenal for collecting on delinquent accounts, they are a calculated gamble as there is no guarantee of their success. We have systems in place that are effective at collecting, and not geared to just bill as many attorney fees on a file as unfortunately, many others in the industry do.

Our firm understands Board procedure and we work closely with Board Members and their Community Management Team to ensure member notice requirements are met, elections are fair and proper and that official records are up to date and enforceable. Every Association is different and as our client, our team takes care to interpret your covenants, draft amendments and revise governing documents when necessary. Our firm is well equipped and experienced to provide board members foundational knowledge to ensure that the Association is operating effectively and in compliance with Florida legislation.

WHAT DOCUMENTS GOVERN FLORIDA ASSOCIATIONS?

• FL Statutes

• FL Admin Code

• The Declaration

• Articles of Incorporation

• By-Laws

• Rules and Regulations or ARC Guidelines

There are many obligations required of a Board Member serving on an Association Board including being familiar with all the documents listed above. It is a large and time consuming undertaking and Murrell Law is prepared to guide your association and its Board every step of the way. As our client, the Board will receive an onboarding call with one of our Attorneys. This onboarding call will highlight the duties and responsibilities of each Board Member, conflicts of interest and how to interpret your governing documents along with any changes in Florida law that may affect the Association.

Board Governance is our most impactful area of practice. If your Association is in need of Board Member education or general counsel, please contact us today. We look forward to being of assistance to you.

Homebuyers or purchasers of condos within a community association are bound by and obligated to comply with the community’s governing documents. It is important to remember that the Board has a fiduciary duty to enforce all of the covenants and rules in the community’s governing documents. Murrell Law works with the Board and community management team to determine and enforce compliance.

Legal remedies for covenant enforcement may include:

i. Issuing Fines

ii. Forced Maintenance

iii. Mediation or Arbitration

iv. Foreclosure

As condominiums, cooperatives, and homeowner associations are each governed by separate section of the Florida Statutes, you need an attorney who is knowledgeable, specialized and experienced, not only in the Statutes themselves, but also how they directly apply to the fact pattern at hand. Association governing documents include a vast array of different covenants governing all types of different matters within your community and Murrell Law is well equipped to successfully assist your Association with any covenant enforcement issue from the start of the dispute through resolution. Our ultimate goal is to to preserve the sanctity, character, and value of the Association.