June 10, 2010
Congress recently passed a federal law entitled Protecting Tenants at Foreclosure Act (“Foreclosure Act”) that supersedes state law and also amends existing federal laws. The primary focus of the Foreclosure Act is to provide protections to tenants of a foreclosed property related to a “federally-related mortgage loan” or a foreclosure on “any dwelling or residential real property.” Broadly speaking, the Foreclosure Act requires that a party taking title to a dwelling or residential property pursuant to a foreclosure (“Foreclosing Party”) assumes such dwelling subject to certain rights of any bona fide tenant.
So what does this mean for you? Massachusetts General Laws 183A and the condominium documents govern the rights of condominium associations against unit owners who refuse/fail to pay common area fees and permit the associations to initiate foreclosure sales, where necessary. As a condominium board member or property manager, there may come a time when you are forced to initiate a foreclosure sale against a defaulting unit owner and his unit because of a failure by the unit owner to pay his condominium fees. In the majority of these situations, a mortgage holder usually steps in at the foreclosure sale and purchases the unit to protect its mortgage. Occasionally, the association purchases the unit itself, either because the mortgage holder failed to act on the foreclosure notices it received, the current mortgage holder could not be located, or there was no mortgage on the unit. read the entire article…
