At ALS, our more than 20 years of experience has shown us that an aggressive approach is most likely to result in the timely collection of assessments on the association's behalf. Let ALS and our attorney-supervised, systematized non-judicial collection procedures contribute to the association's success.
The collection process begins by informing the delinquent homeowner, in writing, that assessments are overdue. If a demand letter by the association, its managing agent or a professional collection company such as ALS does not prompt action, other measures must be taken. California law provides three options:
- A civil action to collect the debt, usually a small claims court action.
- A superior court lawsuit to foreclose on the recorded assessment lien and/or obtain a personal money judgment.
- Commence the foreclosure process of the assessment lien non-judicially.
In the case of a personal lawsuit and a judgment against a delinquent homeowner, attempts to collect the judgment can be time-consuming, expensive and, more often than not, fruitless. A recent study found that only 40% of all small claims court judgments are ever collected. Likewise, judicial foreclosure, as a superior court action, also requires an order from a judge. This is a lengthy procedure, often requiring several months to a year to complete. It also requires personal service on the homeowner, who may have disappeared. Once a judgment is obtained, the association may either proceed with foreclosure on the lien or attempt to collect the amount due from the homeowner's assets, if any assets can be found. Generally, the association will be required to advance costs and pay attorneys' fees for the judicial process.
Non-judicial foreclosure, on the other hand, does not require a lawsuit or court order. Because assessments are usually an association's sole source of income, California law allows an association to immediately proceed with the foreclosure of a delinquent homeowner's unit or home, just as a lender would foreclose on a trust deed. The delinquent homeowner can stop the foreclosure process only by paying the delinquent assessment, or by applying to the court for an injunction. By utilizing ALS, the association pays no deposit or advance fee - all fees and costs are billed to the delinquent homeowner.
At ALS, we believe the non-judicial approach is the fastest and most effective way to collect unpaid delinquent assessments. In most cases, the delinquent assessments, interest, late fees and costs of collection are collected from the delinquent homeowner.
Follow this link for the Association Lien Services Non Judicial Collection Process.
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