Banks have responsibility to pay HOA fees, upkeep property

Q: Thank you for your informative information. I live in Nevada Trails, Palo Verde north section.

There are several homes in our section that are on the market after being foreclosed by banks. Can you tell me if these lenders are responsible for the upkeep of the front desert landscaping once they take over the home. The home next door to me is full of weeds, trash and dying plants. It's a complete eyesore, yet they (the bank) seem to take the time for an open house. We are paying $70 a month but the neighborhood is going downhill due to these empty homes. -- Mary B.

A: Associations are having the most difficult time in enforcing the rules and regulations upon the lending institutions that are now homeowners.

Prior to the homes being listed, it is a gruesome task trying to find out who is the responsible person within the banking institution who supervises these foreclosed homes as well as the person or department who is responsible for the payment of monthly assessments. Once the home is listed, the association has at least a contact person who is representing the lending institution.

Associations should begin foreclosure action against the lending institutions if they are not paying their regular assessments. Many institutions are delinquent and do not pay their assessments until the property is sold. Associations should be charging them interest and late fees and follow their normal foreclosure process in the same manner as they would a homeowner who has become delinquent.

Associations should be sending warning letters as well as hearing fine notices. Remember, it is the homeowner's responsibility to inform the association with a mailing address. If the fine pertains to health and safety issues, the HOA can begin foreclose proceedings upon the property if the bank does not pay the fine. If it is not a health and safety issue, then the association should continue to fine the lending institution and to place a lien on the property for unpaid fines and penalties.

Banks expect you to pay your mortgage on time; associations expect the same.

Most loans have a section in the mortgage document that states the homeowner has an obligation of maintaining the homes in a proper manner and that failure to maintain the house is a breach of the loan agreement and the lending institution could take legal action against the homeowner to repossess the house.

Ironic, how the lending institution includes the maintenance of the home in their loan documents, but fail to maintain the foreclosed homes that they now own.

This is an area which needs legislation. Homeowners, board members and community managers need to push for legislation in the 2009 Legislative session.

Such proposed laws would include a requirement that the lending institutions register with the association as to their mailing address for the billing of association assessments, as well as the person and mailing address of the person or department responsible for the management and maintenance of the home.

We need to start contacting the Commission and Real Estate Division as well as our legislatures prior to the 2009 session and let them know the irresponsibility of the lending institutions.

Q: Our HOA currently consists of only two board members, even though it has been in existence for several years. One is a resident who was appointed by the home builder, but he travels a lot and is not readily available. The other is the builder's employee, who does not live in our community.

Unfortunately, the home builder wrote our covenants, conditions and restrictions that maintains control of our association until more than 75 percent of the homes are sold, even though the majority of communities I have lived in were controlled by the homeowners after 50 percent of the homes were purchased.

In any event, our homeowners association builder's representative insists on holding meetings at 10 a.m. on a weekday morning. Having served on a few board of directors, all of our meetings were held at reasonable times where the majority of homeowners could attend. After all, the HO in HOA stands for Homeowner, not builder. Consequently, most of us who work for a living are unable to attend these meetings, leaving 90 percent of us in the dark regarding what's happening in our community. Communication is sorely lacking, and I believe that is the method to their madness. Since homeowners are not informed, the builder's representative does as he sees fit, leaving us no voice whatsoever.

Are there any state regulations regarding times to hold HOA meetings? In addition, since most builders have pulled back on completing neighborhoods, how long must we live with the builder controlling our HOA? Supposedly, we only need seven to 11 homes to make up the 75 percent. Could this go on indefinitely? If so, we are in trouble. -- Terri T.

A: NRS 116.31032 pertains to the period of control by the developer for homeowner associations. The law states that no later than 60 days after the conveyance of 25 percent of the homes, at least one member of the board is elected by the homeowners. At 50 percent conveyance, at less 33 1/3 percent of the members of the board be elected by the members. If you had a three-person board, you still would have only one homeowner director.

The developer's control of an association terminates no later than 60 days after the conveyance of 75 percent of the homes or five years after the developer has ceased to offer units for sale or five years after any right to add new homes was last exercised.

There is no state law that prohibits the board of directors from having board meetings at any time in the week or month. Your particular developer has always been very cognizant of its homeowners. You need to contact the corporate office and speak to the head officer of the Las Vegas office. Let him know of your concerns.

Ask them to change the meeting times for your association to accommodate the homeowners. Hopefully, you will have a good attendance, which is generally not the case for so many associations where homeowners do not attend the board meetings even when convenient.

Barbara Holland, certified property manager, broker and supervisory certified association manager, is president and owner of H&L Realty and Management Co. Questions may be sent to Association Q.&A., P.O. Box 7440, Las Vegas, NV 89125. Her fax number is 385-3759, or she can be reached by e-mail at support@hlrealty.com.