The Fifth District Court of Appeals has ruled that associations may demand when a lender’s foreclosure sale date is set. The court ruled that associations, as junior lien holders, have an interest in the property and the maintenance they perform to the common areas inures to the benefit of the property. Because of this, associations have the right to demand that a foreclosure sale date be set when a lender forecloses.
Excited? Don’t be; the Florida statute upon which the court based its decision is fundamentally different from that which we have in Colorado. In Colorado, only one court hearing is required when a lender forecloses. At the hearing, the only two issues before the court are whether the owner is in default and whether the owner is in military service.
We continue to see lender’s initiate foreclosure, only to continue the sale date for 6-12 months. This is detrimental to associations because the lender is not obligated to pay assessments during this time frame, and the property is often abandoned and/or neglected, which impacts property values.