Are you interested in moving to Puerto Rico so you can soak up perpetual summer days and seaside ambiance for the rest of your days? Buying a home in one of Puerto Rico's many homeowners' associations is a good way to make the most of it.
HOAs offer a good quality of life, provided you can afford your HOA fees and don't mind playing by the rules. Efficient HOA fee collections are vital for maintaining the appealing amenities on offer, and strict regulations help maintain order in these attractive communities.
That's why HOAs have the power to place an HOA lien against a homeowner's property if they don't pay their fees. Read on to find out what this means.
What Is an HOA Lien?
A lien is a legal claim against your property. There are two main types of liens: voluntary liens like a mortgage and involuntary liens like tax or HOA liens.
All liens cloud the property's title and make it difficult for homeowners to refinance their home or sell it.
An HOA lien may comprise the following:
- Past-due HOA fees
- Lawyer's fees
- HOA fines
Every HOA has a set of CC&Rs that regulate the community. Every resident must comply with these regulations.
Any homeowner who violates the rules of the HOA must attend a hearing and could face a fine if they don't comply with the outcome within a set time frame.
If you disagree with some of these HOA rules, you can attend an HOA meeting to discuss potential changes.
How to Avoid an HOA Lien
The only way to avoid an HOA lien is by paying your HOA fees on time every month. So what happens if you can't make a payment due to unexpected expenses or a layoff?
If you don't pay your fees, the HOA management company or HOA board will issue a delinquent notice. It's best to approach them about making a payment arrangement as soon as possible.
If you ignore the debt or don't stick to the arrangement, the HOA could place a lien on your home and ultimately foreclose on the property.
The HOA Foreclosure Process in Puerto Rico
Property foreclosure in Puerto Rico is a judicial process. The HOA must file comprehensive documentation with their local court to start the proceedings.
If the foreclosure is uncontested, the judge will rule in favor of the HOA.
HOA liens have super lien status in Puerto Rico. That means they take priority over other liens against foreclosed properties up to a specified amount.
If your mortgage payments are up-to-date, your lender may pay the super portion to prevent property foreclosure and protect its mortgage. The only other way out of foreclosure is to settle the lien amount yourself.
Stay-Up-to-Date With Fee Collections in Puerto Rico
As an HOA board member, the HOA lien and foreclosure process can be cumbersome, time-consuming, and unpleasant, but there are ways you can reduce the incidence of unpaid fees.
PMI Central PR HOA management services have years of experience managing HOAs. We can help you set up cost-effective budgets, manage reserve funds efficiently, and collect fees promptly.
Get in touch right away for assistance with your HOA in Puerto Rico.