Payback! Hundreds of Homeowners Associations Threaten Banks with Foreclosure

by on January 4, 2013 · 8 comments

in Civil Rights

By Laura Gottesdiener / Alternet

It’s payback time—literally. In Florida, hundreds of homeowner and neighborhood associations are foreclosing on banks that have failed to upkeep their repossessed properties, according to—of all things— a CNN Money report.

Florida is one of the states hardest hit by foreclosures, and there are nearly a half-million foreclosed houses now standing vacant and often slowly deteriorating. When a bank forecloses on a house, evicts the family and then repossesses the property, it also assumes responsibility for maintaining the home and yard and paying homeowner or condo association fees. Yet, some of the nation’s largest and richest banks have been unable or unwilling to upkeep their properties—prompting neighbors across Florida to declare enough is enough.

One Miami lawyer, Ben Solomon, has filed more than 1,000 liens against banks for failing to maintain their properties or pay their homeowner association fees. And when the recalcitrant banks don’t comply, Solomon slaps them with a foreclosure notice—131 thus far.

The push to hold banks accountable for their properties isn’t simply sweet justice against the world’s worst neighbors. Unmaintained properties create a host of problems for the surrounding neighborhood—problems that Bank of America, JP Morgan, U.S. Bank and other major Wall Street institutions are going to have to start dealing with if they want to continue foreclosing on and repossessing millions of homes across the United States. First off, an unmaintained property drives down the values of all surrounding homes, further putting neighboring homeowners at risk of default. (Multiple studies have shown that underwater homeowners are more likely to default than those who do not owe more on their mortgage than their homes are worth.) Secondly, vacant, foreclosed homes increase crime, adding an extra expense for strapped city budgets and putting the whole neighborhood at risk. Third, in neighborhoods homeowners associations, other families end up paying extra for things like water and garbage pickup because major global corporations like Deutsche Bank can’t even pitch in their fair share of the community expense. Adding insult to injury, banks are far more likely to leave properties unmaintained in neighborhoods of color, according to a report by the National Fair Housing Alliance.

Solomon has already won tens of thousands of dollars from some of the nation’s largest banks—and even foreclosed on one mortgage servicing company, NovaStar, for failing to maintain its house in the Keys Gate Community Association in Homestead, Florida.

{ 8 comments… read them below or add one }

MRedman January 5, 2013 at 6:43 am

Perfect! I hope the banks use their power to destroy these disgusting HOA things.

What a disgrace to American democracy these HOAs have become


Rick Chalmers January 6, 2013 at 5:38 pm

Mr. Redman, your reply was a surprise for me to read! The basis of the article described banking institutions as being poor “citizens” of the communities mentioned by being absent and defaulting in legal, contractual assemblies known as an HOA.

Then along you come and spew venom about HOA’s. My first thought was that you missed the point of the article. Then I thought maybe you once had a hard time meeting abiding by some HOA agreement you signed on to and have not as of yet acknowledged your responsibility in the matter.

In either case, good luck with your upset. I hope you can find some way to reconcile the fact that HOA’s are not evil. They are covenants that are entered by consent and that they work very well for the people who understand them.



MRedman January 6, 2013 at 5:45 pm

HOAs are garbage. They are the result of a sweetheart deal with developers and municipalities (one gets to build, the other gets to tax…..homeowners get nothing but the bill)
There are no open meeting laws, no election laws and no chain of custody of ballots laws that apply to HOA “governance”
This makes them tin pot banana republics with no business “governing” American citizens.
A recent case in Virginia found a homeowner who sued his HOA right out of existence!
And the homeowners there are thrilled!
I certainly hope the Banks , which the HOAs have now stupidly angered, go after these cheesy organizations and tear them to pieces on a national scale!


Rick Chalmers January 7, 2013 at 10:28 am

Mr Redman, thank you for clarifying your position.

I find it illogical that you equate any HOA to a “tin pot banana republic” that “governs” American citizens.

Joining an HOA is completely voluntary. Nobody is forced to join one. Your entire point of view seems to ignore this fact and makes it appear that you are either uninformed or otherwise ignorant of the utility of voluntary covenants.

I repeat and amplify an earlier comment I made: those who bellyache about HOA’s probably joined one without paying attention to what they were agreeing to. It is generally the most irresponsible people that blame the rules of organization. The rest of us work to change the rules when it is required.

Thank you,



Erik January 7, 2013 at 10:14 pm

and when this “successful” HOA sues and forecloses on these properties, all the members are saddled with ADDITIONAL costs not budgeted for and a murky morass of just how this association can own real property…


Rick Chalmers January 8, 2013 at 5:33 pm

Erik, I won’t represent or defend either HOA’s nor banks is this discussion.

As far as I have experienced, HOA’s do not move to foreclose, they usually put a claim on the title that must be paid when the property changes hands. I doubt ownership of foreclosed properties is within the scope of but a few HOA’s but maybe you have information otherwise.



MRedman January 9, 2013 at 5:47 am

You must be living on another planet. HOAs have no constraints on their little private governance, and therfore their governance is a joke.

You might as well be living in Cuba or the former Soviet Union. Funny..even the “press” in these places are run the same, with the board having strict control on what the homeowner gets to see with regard to “news”/

Look at’s 10 things your HOA WON”T tell you.

But they must be a bunch of “disgruntled” homeowners who are rude enough to publish the truth about these places.


MRedman January 9, 2013 at 5:54 am

HOAs are run by unqualified amatuer volunteers, and the sky is the limit for their foolish and even vindictive conduct.

Fines are an unconstitutional delegation of police and judicial powers (See Supreme Court of Virginia ruling on HOA fines), and in Fl. where this power has not yet been stripped from these organizations…you see the absurd results of this power.

Homeowners have lost their home to HOA fines for the choice in shrubbs or other arbitrary reasons.

As an American citizen, HOAs disgust me, and light weight dopes who enjoy this power over their neighbors are nothing but modern day Quislings.


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