1. Registry for Associations.  Under the Auspices of the Division of Real Estate, homeowner associations will be required to register on a yearly basis.  The purpose of the registry is for the State of Colorado to get a handle on how many associations actually exist in Colorado and to be able to communicate with those associations.  The current anticipated cost of the registration is $20.00 for the first year and is expected to reduce to approximately $15.00 for the second and subsequent years.  However, an updated fiscal note is being prepared which will take into account the retooled version of the bill.  We will provide you with more information on the anticipated cost for associations as it becomes available.
    
2. Track Inquiries & Complaints.  The Division of Real Estate will also be responsible for tracking inquiries and complaints relating to homeowner associations.  The purpose of this provision is to determine whether there are any trends of concern relating to the complaints.  This data will be utilized to determine whether future changes to the regulation of associations are necessary.  Revisions to CCIOA are currently based upon anecdotal complaints received by legislators and do not necessarily reflect trends in associations.  
    
3. Information Clearing House.  The bill also provides that the Division of Real Estate will act as a clearing house for information concerning the rights and duties of unit owners, declarants, and homeowner associations.  

We will continue to keep you updated on HB 1278.

In the Miami-Dade ruling, the bank was sanctioned to pay roughly $7300 to the association, including an additional $2000 to cover its legal fees. The sanction was for improper conduct which delayed the foreclosure sale, including not sending a representative to a foreclosure sale and not publishing timely notice of the sale, both of which resulted in the automatic cancellation of the the sale.

Why would a bank want to delay a condominium foreclosure case? The reason suggested by the association in the Miami-Dade ruling is that a bank isn't responsible for any assessments that accrue until the bank takes title to the Unit. Delay the sale, delay any payments owed. 

Although the Florida decision does not set precedent, sanctions for improper delays certainly would be a useful tool to quicken the foreclosure process!

CAI's Colorado Legislative Action Committee ("CLAC") is asking that you contact your State Representatives today to ask them to oppose HB 1290 - since homeowners living in small common interest communities deserve the same protections that homeowners living in larger associations are afforded under CCIOA.  

Attached is a Position Paper created by CLAC which more fully explains the problems with HB 1290.   

Please utilize Project Vote Smart to locate the contact information for your State Representative.  Simply type in your zip code on the left hand column of the webpage where it says "Find Your Representatives."

1. Advocate for the rights of unit owners in the governance of associations;
2. Offer to mediate disputes between unit owners and their associations;
3. Act as a clearing house for information concerning the rights and duties of unit owners, declarants and associations;
4. Report to the Division of Real Estate suspected violations under the legislation or of the Division's rules; and
5. Report other suspected violations of the law to the appropriate authorities.

1. SB 93 creates uncertainty for homeowner associations.  SB 93 requires an association  to accept payment from the certificate of purchase holder.  However, the bill does not require the certificate of purchase holder to tender payment of the full amount of the association's lien.  Are associations required to accept less than full payment of the lien?  What recourse do associations have if they do not receive payment for the full amount of the lien?  The bill is silent on these issues and creates uncertainty and loss of revenue for associations. 
2. SB 93 is vague and creates unreasonable expectations for homeowner associations.   SB 93 does not specify when the certificate of purchase holder may tender payment to an association.  Is an association required to accept payment once it has already redeemed the property?  Is a volunteer or agent of the association required to be available to accept payment anytime of the day before the redemption period ends?  Are board members required to accept payment at their places of business?  Are board members required to sit home and wait for certificate of purchase holders to make payments?  All of these questions will end up being decided in the courts.  Associations cannot afford this litigation. 
3. SB 93 will create a procedural mess.  The amended version of SB 93 attempts to put into the highly procedural public trustee foreclosure statute the concept that certificate of purchase holders have the right to pay off junior lienors.  However, the bill does not address when in the complicated timeline these payments can be made and how these payments affect the inconsistent procedural rights afforded junior lienors in the statute.

Attached is a Fact Sheet that more fully explains the problems with SB 93 and a copy of the Pre-Amended Bill.

Please utilize the Project Vote Smart weblink below to locate the contact information for your State Senator.  Simply type in your zip code on the left hand column of the webpage where it says "Find Your Representatives." 

http://www.votesmart.org/index.htm 

URGE SENATORS TO OPPOSE SB 93!!

SB 10-93 Orderly Resolution of Claims in Foreclosures Involving Junior Liens - By Senator Lundberg

Community Associations Institute Urges you to OPPOSE SB 93

As amended, SB 93 permits a certificate of purchase (COP) holder to pay a junior lienor the secured debt without the ability of the junior lienor to refuse payment and without adequate procedural safeguards to protect the interests of homeowner associations under Colorado law.

Please call your Senator now to oppose SB 93 for the following reasons:

·         As amended, the bill creates uncertainty for homeowner associations.

·         Homeowner associations will be required to accept tender regardless of the amount or accuracy of the amount.  This will lead to a loss of revenue for associations during tough economic times with no recourse against the COP holder.

·         This bill will create a procedural disaster.

Attached is a fact sheet and a copy of the pre-amended bill.

Please utilize the Project Vote Smart weblink below to locate the contact information for your State Senator.  Simply type in your zip code on the left hand column of the webpage where it says “Find Your Representatives.”

http://www.votesmart.org/index.htm

1. Advocate for the rights of unit owners in the governance of associations;
2. Offer to mediate disputes between unit owners and their associations;
3. Act as a clearing house for information concerning the rights and duties of unit owners, declarants and associations;
4. Report to the Division of Real Estate suspected violations under the legislation or of the Division's rules; and
5. Report other suspected violations of the law to the appropriate authorities. 

Testimony on the bill included assertions that associations are essentially auctioning off these lien rights to the highest bidders and are making money hand-over-fist.  There was also testimony that the investors who purchase these lien rights are unscrupulous in driving down the purchase price of properties at foreclosure sales - thereby reducing their costs to redeem.

In addition to considering the remedies outlined in the legislation, Senators kicked around the idea of extinguishing the redemption rights of all junior lienors and to require them to protect their liens by bidding at the foreclosure sale.  Obviously, requiring an association to bid on property at a foreclosure sale to protect the association's lien would be a horrendous result.  The bill was ultimately tabled by the Committee and Senator Lundberg was directed to meet with stakeholders to hammer-out a mutually acceptable solution.  

Tell us what you think:

1. Do you think the ability of associations to assign lien rights is an important collections tool?
2. Would you support the termination of redemption rights which would require associations to bid on the property at a foreclosure sale to protect the value of the association's lien?

1. Submit with the notice of intent to redeem, a signed statement of the amount payable to the association on the association's lien; 
2. Accept payment of the lien amount which is tendered by the purchaser within 10 business days following the public trustee foreclosure sale;   
3. Execute a release of lien upon receiving tender of payment.