Almost all of us go through financial hardship at one point or another in our lives. Whether it’s the rise in the cost of living or another problem in your life that’s causing you to experience financial difficulties, many people are currently feeling anxiety every time a new bill comes through the door.
If you’re looking at your options now, take a deep breath. We’ll help guide you through your options, some recommendations on what action you can and should take next, and what you can expect if you choose (or are forced) to forego paying your monthly condo fees.
So often when we’re experiencing financial hardship, we have to start looking at the bills we have and make choices about which can go unpaid for the longest. If at all possible, always continue to pay your mortgage and condo fees above all other bills.
Why? Because your mortgage lender and the condo association are the only two (provided you don’t have any other liens on the property) that can foreclose on your property if you do not continue to pay your monthly payments.
Now, that’s not to say there’s nothing you can do in either case. While your mortgage lender will start the foreclosure process relatively quickly if you fail to keep up your payments and do not communicate sufficiently with them, your condo association is unlikely to take action until things get out of hand.
We’ll talk you through what you can and should do below, but in the case of your condo fees, this is what you can expect to happen if you fail to pay your fees:
- Late notice, or notice of missed payment: The first thing that will happen is you’ll receive a notice that your payment is late or that you’ve missed it. It will explain what you can do to rectify the situation, who you should contact if there is an issue (such as being unable to pay), and what will happen if you do not pay.
- Late fees: Either immediately or after a certain period, you’ll start getting a late fee that will add to the outstanding amount. Your condo association’s governing documents will state how much these fees are.
- Suspension of services/rights: If you continue to miss your payments, your condo association may suspend your right to use some amenities or receive some services.
- Lawsuit: No condo association will be happy about having to take you to court to get the money they are owed, but if pushed, they will likely do so. Having an open line of communication with your condo association is the best way to avoid this.
- Lien: Most condo associations have the power to put a lien on your condo, which means they will be owed the money you owe if you sell your home. They cannot do this until you have missed six months of payments.
- Foreclosure: If all else fails, they may move forward and take steps to foreclose on the lien they placed on your property. In Massachusetts, they can start this process as soon as they have a lien on your property.
In both the case of your mortgage and your condo fees, the first thing you need to do is talk to them (your lender and/or the condo association, respectively). While it is incredibly unpleasant to confess that you are struggling financially, people are understanding and will want to do what they reasonably can to help.
While your mortgage lender is a big company, it’s important to note that your monthly condo fees are more like a money pool that goes to paying for the services and maintenance your property needs. While these are things you can forgo for a while with a single-family property, you cannot avoid them with a condo.
If you don’t pay and don’t tell the COA why, your neighbors will be forced to pick up the slack, which is when you may start to find them less than sympathetic. Explain your situation early and tell them what you’re doing to change the situation. They may be able to reduce your payment or give you a break for a few months, but whenever possible prioritize these two payments.
Here’s a quick breakdown of what you should do next:
- Speak to your COA and tell them that you’re experiencing difficulty, and see if there’s anything they can do to lower your payments
- Speak to your lender and tell them that you are experiencing difficulty – this is a good idea even if you can continue to pay your mortgage payments
- Cut out all unnecessary spending and prioritize which bills you pay in the order of how much they will affect you – for example, your mortgage and COA payments keep your roof over your head, next comes energy bills, internet, and food
- Look at what help is available to you in your area (unemployment, food banks, healthcare, and so on – click here for a few key resources)
- Forecast your next steps – is this a temporary situation due to job loss or a short-term illness or injury? If so, start thinking about how you can get some income coming in. Look for online and in-person opportunities in your area.
- Consider selling your home – If you’re struggling to see any sunlight on the horizon, the best thing you can do is consider selling your condo.
While selling may not yet be on your radar, all too many people dig themselves into a deeper financial hole by trying to hold onto a home they can no longer afford. Our homes become a piece of who we are, but the truth is it’s better to fully live somewhere we can afford than to shelter somewhere we can’t.
It’s also important to realize that your current situation is not permanent, and just because you have to sell your home now does not mean you will never have one as nice (or nicer) in the future.
Change is the only constant in life, and while things seem bleak now, you’ll find the future looks brighter when you are in a situation where you are no longer worrying about how to meet your bills. For now, that may mean selling your home and renting, or buying somewhere smaller or further outside of town.
If you’re ready to stop worrying about how you’re going to face your neighbors if they know you’re experiencing financial difficulty, selling your condo is the best next step for you. We make selling your condo fast, easy, and stress-free. All you need to do is reach out to us with a few details about your condo and we’ll send you our best cash offer for your home.
You don’t need to do any repairs, deal with realtors, open houses, or worry about how many more months you’re going to be stuck in your current situation. We can close in a matter of days, giving you the freedom to move on with your life and get a fresh start, whether that be buying a more affordable home elsewhere, or renting for a while until you get back on your feet.