HOA super-lien threat grows

Julie C. Nichols General

HousingWire – Jacob Gaffney

Homeowner associations can pose a danger to mortgage servicer and investors. They are great for homeowners, but represent a danger to those involved in mortgage finance, especially in the so-called super-lien states.

These states grant executive authority to HOAs. In the case of errand dues, the homeowners association can fast track the foreclosure past the mortgage servicer’s loss mitigation process. Basically in super-lien states, the HOA holds all the cards when dealing with distressed debts. According to Sperlonga, a data and analytics firm which spent the last 18 months creating industry’s largest database featuring HOAs, more states are looking to upgrade to super lien status.

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