Detroit Bankruptcy Lawyer: Can I Discharge Home Owner Association Fees in Bankruptcy?

     This is a common question I get in my clients Chapter 7 or Chapter 13 cases. And it is a good (and important) question to ask. As with any question in bankruptcy, it depends on which chapter you are filing under.      If you are filing a Chapter 13, AND you want to retain your condo, then the past due condo fees (or Home Owner Association (HOA) fees) will be treated as a secured debt and they must be paid in full through your Chapter 13 plan. In addition, you must keep paying your current HOA dues in full each month. If you are surrendering your home, then you will be allowed to treat the past due HOA fees as an unsecured debt, and paid back as the same rate as your other unsecured creditors.  You will still be responsible for paying the current HOA fees each month until the mortgage company that owns the note on your condo takes possession.       If you are filing a Chapter 7, then the past due HOA fees will treated as an unsecured debt and will be discharged with your other unsecured debt. However, you will be required to pay the current HOA fees each month, regardless if you surrendered your condo or no longer live there. You are legally responsible for all post-petition HOA fees until the mortgage company that owns the note on your condo takes possession. So as long as your name is still on the deed to the condo, you will owe it. Bankruptcy law does not provide a discharge of post-petition HOA fees. Keep in mind,  it is up to the mortgage company to decide to foreclose and take possession. There is no mechanism to force the mortgage company to take possession. They could wait years to take possession or they may never foreclose. Meanwhile, you are still responsible to pay those post-petition HOA fees.      If you have more questions about HOA fees and bankruptcy, or have other questions in general, feel free to call your Detroit Bankruptcy Lawyer at (586) 439-4297 and set up your free consultation. We will answer your questions and advise you if bankruptcy will solve your HOA problems.    

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