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If you live in a homeowner association development in cities such as Laguna Beach, CA, San Diego, Orange County, Palm Springs, Corona del Mar, Laguna Beach, Palm Desert, Long Beach, Santa Ana, Anaheim, Riverside, Chula Vista, Irvine, San Bernardino, Huntington Beach, Fontana, Moreno Valley, Oceanside, Rancho Cucamonga, Ontario, Garden Grove, Del Mar, Palmdale, Corona, or in Escondido, Orange, Fullerton, Costa Mesa, Victorville, Carlsbad, Temecula, Murrieta, Mission Viejo, El Cajon, Vista, Westminster, Corona del Mar, Santa Monica, Santa Barbara, Hesperia, Newport Beach, Buena Park, Indio, Coachella, Rancho Mirage, Indian Wells, or La Quinta you don’t need to be a California real estate lawyer or a homeowner association attorney in CA to know there are probably some homeowner associations in your city that are likely to have serious financial problems.

 A crisis is looming for homeowner associations in California and few homeowner associations are alert to how bad the crisis is about to become.

Judging from the homeowner association problems in Florida, this may be the largest problem they have ever had to face. And with most homeowner boards consisting of common individuals and retirees, few are prepared for the storm headed their way.

Most homeowner associations set aside reserves for roof repairs and other projects, both short term and long term. Many reserves are underfunded and even those that are properly funded out of homeowner fees and assessments are based on receiving the full amount of fees from the homeowners in their association each month.

Do you see the problem yet? As of six months ago, nearly fifteen percent of homeowners in such associations were in arrears or in foreclosure. Today that number is surely much higher and California has been on pace with Florida for the most part in all the worst statistics such as foreclosure rates, etc.

Once a homeowner association begins to feel the pinch of not being paid thousands of dollars in homeowner fees each month, problems like they’ve never faced before, become a catastrophe.

As of 2007, some 58. 8 million Americans were living in association governed communities. Associations need to not just break even each month, they need to keep setting aside monies for yearly and longer term projects. If just ten or fifteen percent of the homeowners are delinquent in paying their dues, or if the banks that foreclose on properties fail to pay the dues on those homes, trouble ensues.

Homeowner associations have to either cut back on projects, services and costs, or assess the remaining homeowners. There is little they can do to reduce fixed costs such as taxes, or contracted services, so they cut back on landscaping, put off improvements, maintenance or asphalting of the roads, and repairs.

Homeowner associations can no longer count on loans from their banks, and heaven help those homeowner associations who kept reserves of over $100,000 in a bank that has failed and which had FDIC insurance on only the first $100,000 prior to the U. S. government increasing the amounts covered by the FDIC. Foreclosures of vacant property add another set of problems.

Foreclosures aren’t quick and while they drag through the process, properties become run down or infested with pests.

An association has a duty to keep solvent and keep setting aside money for future repairs. They must therefore continue to levy special assessments on the paying homeowners. When homeowners can no longer pay the additional assessments, the problem only compounds itself.

California homeowner associations need to anticipate and prepare for the storm headed their way. They need to live by the creed, “Things can always get worse,” because they almost certainly will.

If you have a homeowner association, real estate or mortgage issue in Orange County, San Diego, in Riverside, Palm Springs or anywhere in Southern California, we have the knowledge and resources to be your California Homeowner Association Lawyers, and Orange County and San Diego Real Estate Attorneys. For this reason, be sure to hire a California law firm with real estate and homeowner association lawyers who can represent you from La Quinta to Carlsbad, Anaheim, Irvine, Fullerton, Oceanside, Ontario, Rancho Cucamonga, Orange, Temecula, Westminster, Buena Park and Mission Viejo.

If you have a homeowner association or real estate issue, and need to know your rights, call the Law Offices of R. Sebastian Gibson, or visit our website at http://www. sebastiangibsonlaw. com and learn how we can assist you. You can also call us to speak directly to Sebastian Gibson on the phone about your legal matter.