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Maine Alliance for Road Associations

FORECLOSURES

  • 11 Nov 2011 11:13 AM
    Quote
    Message # 747542
    Deleted user
    We are a statutory road association and have a parcel on the road that went into foreclosure in August '11.  The owners have moved out and I can't find them in order to have them served with a small claims complaint for unpaid assessments.  I have attempted to serve them with a certified letter sent to the address to which the tax bill is sent but the letter wasn't accepted.  The town doesn't know where they are and the foreclosing institution states that it has to protect the owners privacy.

    Any ideas or comments? 
  • 11 Nov 2011 11:33 AM
    Quote
    Reply # 747555 on 747542
    Deleted user
    Cal Cutter wrote:We are a statutory road association and have a parcel on the road that went into foreclosure in August '11.  The owners have moved out and I can't find them in order to have them served with a small claims complaint for unpaid assessments.  I have attempted to serve them with a certified letter sent to the address to which the tax bill is sent but the letter wasn't accepted.  The town doesn't know where they are and the foreclosing institution states that it has to protect the owners privacy.

    Any ideas or comments? 

    If the property is being foreclosed upon, there is a 0% chance that the owners will pay the assessments.  You should contact the bank regarding the assessments, as when they take possession of the property, they will also be responsible for the assessments.  You may record a lien against the property in the Registry of Deeds; this should ensure that the property cannot be transferred until the lien is satisfied.
  • 12 Nov 2011 12:37 PM
    Quote
    Reply # 748471 on 747542
    Deleted user
    What Todd writes is excellent advice.  To expand on his post, I have had pretty good luck waiting for the inevitable sign or posting on the property to show up.  Copy the contact info and email them stating your position.  The only pressure you can bring to bear (other than the lien previously discussed) is to inform the bank/realtor that by law, the debt goes with the property therefore, if the debt is not paid as part of the closing or by the closing, then you will have no alternative but to pursue it with the new owners and if needed, in small claims court.  This is usually enough to to get their attention and work with you in good faith as they will want to characterize the sale to the new owner(s) as "free and clear".  Keep copies of ALL of your dealings and correspondence in case they try to pull a fast one.  Be patient as this will likely be a long process.  Remind them from time to time that you are still watching and wish a status report on any pending actions.  Good luck.
  • 13 Nov 2011 8:17 PM
    Quote
    Reply # 749109 on 747555
    Deleted user
    Todd Tolhurst wrote:
    Cal Cutter wrote:We are a statutory road association and have a parcel on the road that went into foreclosure in August '11.  The owners have moved out and I can't find them in order to have them served with a small claims complaint for unpaid assessments.  I have attempted to serve them with a certified letter sent to the address to which the tax bill is sent but the letter wasn't accepted.  The town doesn't know where they are and the foreclosing institution states that it has to protect the owners privacy.

    Any ideas or comments? 

    If the property is being foreclosed upon, there is a 0% chance that the owners will pay the assessments.  You should contact the bank regarding the assessments, as when they take possession of the property, they will also be responsible for the assessments.  You may record a lien against the property in the Registry of Deeds; this should ensure that the property cannot be transferred until the lien is satisfied.
    Thank you for your comment.  You state that when the bank takes possession of the property they will be responsible for the assessments, however that is not my understanding.  Kindly point me to the section of law that will confirm your position.  Two years ago we had a road association member escape to Florida after selling his property at a private sale (no RE agency involved) leaving with a few hundred dollars in unpaid assessments.  My understanding is that we can't recover that money.

    Cal Cutter
  • 13 Nov 2011 8:53 PM
    Quote
    Reply # 749122 on 749109
    Deleted user
    Cal Cutter wrote:Thank you for your comment.  You state that when the bank takes possession of the property they will be responsible for the assessments, however that is not my understanding. 

    It's a basic concept of property law; liens run with the land. Just like a mortgage lien or a tax lien, it doesn't matter if the property owner doesn't pay, the debt is attached to the land, and any future owner, until it is satisfied.

    Kindly point me to the section of law that will confirm your position. 

    23 MRSA 3103 states "The commissioner or board shall collect the money as town taxes are collected".  So, you want 26 MRSA 175-A, Tax Lien.

    Two years ago we had a road association member escape to Florida after selling his property at a private sale (no RE agency involved) leaving with a few hundred dollars in unpaid assessments.  My understanding is that we can't recover that money.

    Yes, a particular owner may escape the lien, but the property cannot. If you didn't record the lien at the Registry of Deeds, the buyer would have no way of knowing that a lien was outstanding. If the buyer had known, they would have required the seller to satisfy the lien before transferring the property; otherwise, they buyer would inherit the debt when they took possession of the property. That's why you want to record your lien.

                            The Maine Alliance for Road Associations


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