Lender Foreclosures and Assessments

Civil Code Section 2924b was passed in January 1, 2009 which requires lenders to notify homeowners associations when they foreclose on property located within a homeowners association.  The lenders figured out how to avoid the notice requirement by foreclosing on properties and then refusing to record the transfer of ownership.  This allowed the lenders to avoid the payment of homeowner association assessments because they thought their duty to pay assessments did not begin until they recorded the deed.  We want to remind you about Civil Code Section 2924.1 that took effect on January 1, 2013.  Section 2924.1 says that lenders must record foreclosure sales within 30 days of the sale date.  In other words, once the sale is recorded, the lender must start paying assessments as they are levied by the association.

Jamie Schwartz