Mark Axinn Featured in the Cooperator News New York Q&A on Collecting Arrears Options for Co-op & Condo Boards

Cooperative and Condominium Practice chair Mark Axinn was featured in the Cooperator News New York's Q&A series discussing the options available to co-op and condominium boards when collecting unpaid maintenance, common charges, and other arrears.

Mark Axinn explained several key differences between collections in co-ops and condominiums, including lien priority and the remedies available to boards. Mark said, "In a co-op, the corporation has the first claim on the shares and can get paid in full before a [shareholder’s] mortgage lender; in condos it is the opposite; the bank gets all the money it is owed first, and only then is the condominium association paid its arrears from surplus funds, if any."

Mark emphasized the importance of acting quickly when an owner falls behind. “The first action boards should take is to immediately contact the unit owner to ascertain why the monthly fee was not paid,” he noted. "Then if the matter is not resolved, the board should contact their legal counsel to address the arrears situation quickly, especially in condos where lenders have priority. Filing a common charge lien is always a good idea, especially if a sale or re-finance is imminent. If the unit is rented, and the unit owner is more than two months in arrears to the association, the condo can demand direct payment of rent."

In addition, the article discusses additional collection tools available to condominium associations, including the ability in certain circumstances to direct a tenant to pay rent directly to the association when a non-resident unit owner is more than sixty days delinquent.

Click on the link below to read the complete article.