by Elaine Roberts Musser –
On July 8, 2009, I had the honor of being interviewed here in Davis by Tom Vacar of KTVU Fox 2, Oakland. The story to be covered is about the growing problem in the homeowner association arena of artificial debt created by subsidiary debt collectors, working in concert with their affiliated law firms and homeowner association industry managers. The reason I was chosen as one of several persons interviewed, was my intimate knowledge of this practice, because of several cases I have worked on as both a volunteer attorney and board member of the Oakland based Center for California Homeowners Association Law.
Here is how the scam works. When a homeowner tries to tender a check to pay for their monthly assessment to the homeowners association through its hired management company, the check is either not accepted or not posted to the homeowner’s account in a timely manner. The result is a determination by management the payment is now suddenly “overdue”. This triggers the collections process, with the homeowners “delinquency” immediately sent to collections. Here, the money meter begins to run, racking up huge collections costs and late fees. If the total debt owed, including all collections costs and late fees, is not paid posthaste and in toto, the homeowner’s house is held hostage with a threatened foreclosure. The collections process is tantamount to a train rolling downhill on the tracks – almost impossible to stop once begun.