S.B.S. Lien Services
How S.B.S. Lien Services Can Work For Your Association
When a homeowner fails to meet their obligation to pay monthly assessments as required, it is the responsibility of the community association to take the necessary steps to collect the assessment. In fulfilling that responsibility, there are strict procedures the association must follow when a homeowner is behind and owes money to the association on their assessment or other fees.
When this situation occurs, the association will usually first try to work with the homeowner to make payments and get caught up. When this doesn’t work, the association will most often use the services of a lien collection company such as S.B.S. Lien Services (S.B.S.) to handle the collection process for them. We handle the entire process of collecting the past due assessments, from sending the initial demand letter, to filing and collecting on the lien, to foreclosure and the actual auction or sale of the property if it becomes necessary.
Proper Handling of the Situation
We handle the collection process in a totally professional and respectful manner, and our collection activities rarely come to the point of having to foreclose or sell a property. Neither party want this, and a quick resolution is the desired result both parties are always looking for.
Turning Over a Delinquent Account to S.B.S.
The procedure for turning over a delinquent account to S.B.S. is actually as simple as filling out a few forms, sending them into us and we will handle the rest.
Authorization Forms
The first step is to fill out the authorization forms to allow S.B.S. to begin collection proceedings. The first form is called an “Agreement and Authorization to Commence Non-Judicial Foreclosure Proceedings Declaration of Default & Demand For Sale” form. This form itemizes all the assessments, special assessments, and all other fees due. The next one is the “Consent and Authorization” form which authorizes S.B.S. to begin the collection and foreclosure process. These forms can be found on our website and all you have to do is fill them out and fax them to us, along with all the supporting documentation we will discuss next.
Separate forms need to be filled out for each delinquent account. You must indicate on the form any and all Management Company fees and/or special instructions associated with the account.
Updated Account Ledger
The association has to submit an updated account ledger for each account. This printout needs to show all charges to the homeowners account and a current running balance. All special assessment charges (i.e. reserves, plumbing, SBA loan, etc) must be specified.
Covenants, Conditions and Restrictions
For new associations we must have a copy of the associations governing documents and collection procedures. S.B.S. is required by law to cite the information from the CC&R’s in any documents sent to the County Recorder’s Office. S.B.S. will obtain and keep and electronic copy of your CC&R’s on file for all future accounts referred from your association. The process for collection follows the following steps.
Delinquency Policy Letter
In the first step in of the collection process, we send out a Demand/Pre-Lien letter to the homeowner. The Demand/Pre-Lien Letter is sent along with the collection policy and sites policy, procedures, and the amounts of all assessments, late fees, interest and penalties owed.
Filing the Assessment Lien
If the homeowner fails to respond to the demand letter and fails to the pay the balance, the process goes onto the second step. S.B.S. will then file an assessment lien against the homeowner.
The Foreclosure Process Begins
S.B.S. is usually very successful at avoiding the foreclosure process by the time the first two steps have been completed and it becomes necessary to actually begin the foreclosure process. We have a 90% success rate in collecting delinquent assessments prior to initiating forclosure.
If the homeowner does not respond to the demand letter and does not satisfy the assessment lien, a ‘Notice of Default’ is recorded according to civil code section 2924, and the first step in the actual foreclosure process begins.
The Notice of Sale
If the homeowner does not respond to the ‘Notice of Default’ within the 3 month reinstatement period, S.B.S. will contact the association to get authorization to proceed with the foreclosure sale.
S.B.S. Lien Services, S.B.S., has specialized in the assessment collection business for over 30 years and is one of California's largest assessment collection companies. S.B.S. has a 90% success rate in collecting delinquent assessments from delinquent homeowners. Contact us today and one of our representatives will be glad to assist you.
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