Equity Analysis:
Make Informed Decisions for Your Community Association
If your collections efforts are falling short, it may be time to rethink your strategy. Choosing to do nothing means the association loses income it was owed and puts your community at financial risk, but taking legal action can be a very expensive gamble. Will you get back what’s owed, or will your community end up deeper in the red?
With the Easy Collect Equity Analysis, board members are empowered to make an informed decision before committing to costly legal proceedings. This analysis helps reveal whether or not legal action will result in fully recovered delinquent funds.
The analysis compiles information about the unit such as if there are any lender foreclosures, any mortgages and other liens, outstanding taxes, the estimated market value, and more. We assemble this information into a detailed, easy-to-read report containing everything you need to decide on next steps.
Before you take legal action, request an Equity Analysis and get peace of mind about the delinquent property.
Answers These Questions:
- Is there enough equity in the property?
- Are there any financial complications?
- Is there already a sale or foreclosure set?
- Is the association’s lien position prioritized?
Know When (and when not) to Foreclose
Mortgage Equity
Equity in a property can determine how likely it is to sell to a future owner if the association were to foreclose.
Sufficient Equity
If the property has sufficient equity, the association lien foreclosure sale is more likely to succeed, resulting in the association being made whole.
Result: Money Likely Recovered
Insufficient Equity
If the equity in a property is insufficient, any buyer looking to purchase at auction will likely pass. That means the association would be left with the title and responsible for manually recovering what is still owed.
Result: Association Money Lost - consider alternative options
Property Encumbrances
Encumbrances to the property, such as tax liens and bank foreclosures, can endanger the association’s position.
No Encumbrances
If the property has no encumbrances, its more likely to sell at an association lien foreclosure sale, resulting in the association being made whole.
Result: Money Likely Recovered
Property is Encumbered
Encumbrances on a property, such as bank liens or tax/IRS liens, will always take priority over an association lien. These can wipe out the available equity, making foreclosure an unfavorable option.
Result: Association Money Lost - consider alternative options
Special Considerations
Protections such as Bankruptcy and Probate proceedings can temporarily stop or slow down foreclosure.
No Delays
If there are no special considerations, a foreclosure may be initiated, and the association is more likely to be made whole.
Result: Money Likely Recovered
Owner is Protected
Properties with special considerations, like probate proceedings or an owner who has filed for bankruptcy, will delay foreclosure. These scenarios put association foreclosure liens on hold until all situations are resolved.
Result: Association Money Lost - consider alternative options
What’s Included in the
Equity Analysis Report?
The Equity Analysis is a detailed report for a single unit. The report contains all of the pertinent property information to help you make the decision on whether to foreclose, including but not limited to: property equity, mortgage balance and status, other encumbrances, and any existing and/or pending foreclosure actions.
Who Can Use the Equity Analysis?
The Equity Analysis Report is available to all Axela clients from within the Axela Technologies collection platform at the simple click of a button!
