A reader's mother is gone, and her condo might be next.

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Question: Μy mother died in October 2017, after being in a nursing home for over a year. She had paid for a condo in cash 10 years ago, and as her only child and heir, I have lived here, too.

Trouble arose when Medicaid took my mom’s income for the nursing home, leaving me with just an Social Security disability check. Condo association dues are behind, and I can’t pay them. I received a letter saying that after 30 days, a lien will be filed. I am in panic mode. Can you give any advice on what I can do?

— Cindy in Oregon

Gerri Detweiler answers…

Falling behind on homeowner and condominium association dues can be as serious as not paying your mortgage or property taxes. Your association can turn the debt over to a debt collector and, as you’ve learned, file a lien against the home. Either can have a serious impact on the individual’s credit reports and credit scores.

Falling behind can also get expensive. In addition to the dues themselves, interest and penalties may accrue. Attorney’s fees will likely be incurred for filing the lien, and those may be passed along to the homeowner as well. These costs should be spelled out in the association bylaws and/or in the “Declaration of Covenants, Conditions, and Restrictions,” also known the CC&Rs.

Unfortunately, the lien may not be the worst that can happen. In some cases, the association can foreclose to collect unpaid dues. For that reason, you need to explore all your options as quickly as possible.

One thing you can do right away is contact the condo association and explain the problem. Ask if you can enter into a payment plan to catch up and avoid the lien. If they agree, get it in writing so there are no misunderstandings. If they aren’t willing to work with you, or if you can’t afford the payments necessary to catch up, then the condo is probably not affordable and you may need to consider selling it.

If you decide to sell, make sure you disclose the debt to your real estate agent. It would also be wise to consult an attorney. The last thing you want to do is to lose the condo because of this debt. You can use the website of the National Association of Consumer Advocates to find an attorney.

There are a few other issues that aren’t clear from your question. Did you inherit the property when your mother passed away? Or are you just continuing to live there? If the property has not been transferred to you through probate or a trust, you’ll want to talk to an attorney immediately.

You mention the condo is paid for.  If you do own it, and you are over age 62, you may consider a reverse mortgage. It will allow you to take money out of the property without having to make monthly payments the way you would if you took out a traditional home equity loan. Reverse mortgages can be confusing, and you will need to contact an HECM (Home Equity Conversion Mortgage) counselor who will provide you with information for free or at a low cost.

Our condolences for your loss, and we hope you are able to find a solution that works for you in the long run.

Gerri Detweiler, along with Mary Reed, is co-author of Debt Collection Answers: How to Use Debt Collection Laws to Protect Your Rights, a free Kindle ebook available at DebtCollectionAnswers.com.

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Gerri Detweiler

Gerri Detweiler

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Ask the Expert, credit report, credit score, debt collections, loans

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Article last modified on July 11, 2018 Published by Debt.com, LLC .