[yellowsnow]

Originally Posted by lvoc

Welcome to the recent Nevada Supreme Court Decision. That is exactly what the court decided. The HOA lien...done properly with proper notice...overrides the First. Period. -

The argument was the bank received proper notice and had the option of simply paying the lien. Failing to do so they gave up their priority.

It is not an ongoing problem as the banks now simply pay the lien. The ongoing issue still to be decided is whether the HOA can include collection costs in the lien. The court has hinted the answer is no...but has not finally ruled.

News Article

Nevada high court: Super priority lien extinguishes first deed of trust | Las Vegas Review-Journal

I was waiting to hear your take on this!

[Everdeen]

I don't have access to what realtors see on the MLS and looked on realtor.com. For the first MLS #1491230, I didn't see anything in the property history that stated the house sold for $6000. And nothing about cash only. Do realtors have access to additional information that supports what you have said?

[Michael-MS]

Originally Posted by Everdeen

I don't have access to what realtors see on the MLS and looked on realtor.com. For the first MLS #1491230, I didn't see anything in the property history that stated the house sold for $6000. And nothing about cash only. Do realtors have access to additional information that supports what you have said?

Yes, the MLS sheet says cash only. That's something you can't find on Redfin or Zillow. But you can view the sales history on Zillow or Redfin and look for lines like this one:

04/18/13 Sold: Foreclosed to lender $6,000

[lvoc]

The GLVAR counsel raises the following issues...


What if the HOA or the Collection agency refused payment of only the 9 months dues as they often do?

What happens if the HOA forecloses on both the priority and non-priority portion of the Lien?

Is a sale for a small percentage of value a bonafide sale?

Is the notice in NRS 116 sufficient to satisfy due process and notice requirements? There is another provision that can be followed which is sufficient so this was not an issue in the Supreme Court Case.

Counsel warns the area will be the subject of much litigation and is not yet stable.

[lvoc]

Seller is also requiring an 8 paragraph disclosure with each clause initialed by the buyer.

[007 license to sell]

This hoa this is really going to be interesting, there will be no title given to a hoa sale propertym unless they buyer gets a quiet title which takes some doing. Here's some articles regarding hoa sales, buyer beware, it's not as simple as it seems.

New Rules Help HOA's Maintain, Collect - 8 News NOW
New Rules Help HOA's Maintain, Collect - 8 News NOW
Terra West Property Management sponsored a seminar to explain new laws affecting HOA's in Nevada. The company manages 11-percent of the state's HOA's.


Residential Lenders in Nevada Losing Out in HOA Lien Foreclosures
http://www.ballardspahr.com/.../2013...in-nevada-losi...

[forestgump99]

So the way it stands now...in conclusion:

Right NOW...

1. HOA is the Superior Lien...... meaning, the HOA lien is the lien that is number 1 in line and the other liens are lined up after this one fall into secondary status.....and those other liens get the residual monies if the HOA lien has come to foreclosure. Title is taken upon successfully obtaining (bidding) on the the HOA lien.

2. The property's first Loan from the bank is now second in line....meaning.....that the bank lien is paid secondarily if theres a foreclosure on the HOA lien.


So ....what will happen:

Banks could and may require HOA payments be included into the loan (impound account) or the banks will now be just more accountable to HOA liens and not ignore them and the outstanding accumulation of HOA fines and bills.

[Michael-MS]

Originally Posted by forestgump99

So the way it stands now...in conclusion:

Right NOW...

1. HOA is the Superior Lien...... meaning, the HOA lien is the lien that is number 1 in line and the other liens are lined up after this one fall into secondary status.....and those other liens get the residual monies if the HOA lien has come to foreclosure. Title is taken upon successfully obtaining (bidding) on the the HOA lien.

2. The property's first Loan from the bank is now second in line....meaning.....that the bank lien is paid secondarily if theres a foreclosure on the HOA lien.


So ....what will happen:

Banks could and may require HOA payments be included into the loan (impound account) or the banks will now be just more accountable to HOA liens and not ignore them and the outstanding accumulation of HOA fines and bills.

Yes, there wasn't ever any disagreement on what will happen going forward on new foreclosures. These HOA liens were sold back in 2013 and the banks fixed their "oops" right after it happened.

The point of my post and all the doubt is with how the 300 properties purchased for $3000 each will be handled. I'm personally of the opinion that it's a scam to auction off the property for pennies on the dollar. Someone else mentioned it in a previous post, that an auction of such insignificant value can't null and void the 1st mortgage. If it was going to, the HOA could have sold it for much higher price. Then you also have the issue of whether notice was given properly. So I guess.. still beware of these properties and ignore them on the MLS until title companies are willing to insure them. My big complaint is that these shouldn't be allowed on the MLS while litigation is pending, skewing market values and creating a lot of doubt in buyers.

[lvoc]

Originally Posted by Michael-MS

Yes, there wasn't ever any disagreement on what will happen going forward on new foreclosures. These HOA liens were sold back in 2013 and the banks fixed their "oops" right after it happened.

The point of my post and all the doubt is with how the 300 properties purchased for $3000 each will be handled. I'm personally of the opinion that it's a scam to auction off the property for pennies on the dollar. Someone else mentioned it in a previous post, that an auction of such insignificant value can't null and void the 1st mortgage. If it was going to, the HOA could have sold it for much higher price. Then you also have the issue of whether notice was given properly. So I guess.. still beware of these properties and ignore them on the MLS until title companies are willing to insure them. My big complaint is that these shouldn't be allowed on the MLS while litigation is pending, skewing market values and creating a lot of doubt in buyers.

Nah. MLS allows speculation. These things are well identified and well disclosed. They also are simply unavailable to anyone using financing. So let the speculators take each other money. It is a fair game.

So far it appears that the investors who went after the HOA liens did so knowledgeably. They used the safe notification process for instance...not the arguably deficient one in NRS 116. So this sounds like the banks got outsmarted. No rule prevents that.

[forestgump99]

The problem is not that the HOA sold the liens cheaply because they wanted to, they sold them to the highest bidder....nobody thought these HOA liens would be anything significant.

Most bidders lucked out because when the court ruling came down, they were in possession of these properties they thought they would only have for a few months until the banks foreclosed on them.

Otherwise, people would bid these HOA liens up as they are now doing.

------------------

Unless there is specific action on to the specific property there is nothing to prevent a HOA lien won property from going back onto the market. Sure, this could be become a cluster-fock, but let the chips fall where they may.