Losing money is not a windfall for Las Vegas foreclosures HOA investors
Las Vegas, Nevada real estate investors who purchased HOA liens in real estate auctions and took advantage of the HOA lien super priority status to extinguish first and subsequent mortgages in order to purchase foreclosed homes at bargain prices have suffered another legal setback.
In a 2-1 decision, the 9th Circuit court has ruled that Nevada law requiring mortgage lenders to be alerted of a foreclosure by a homeowners association only if the lender had requested notice is unconstitutional. The panel said the requirement of an “opt-in” request is a violation of the 14th Amendment requiring due process.
Now Nevada Supreme Court has to take up the case again and if this ruling is upheld it can nullify the sales so these homes would go back to the foreclosure process by the lender who holds valid mortgage loans.
Those who have been reading my blog are fully aware that I blame the whole foreclosure mess on the banks and am no fan of banks. However from a moral point of view, what Bourne Valley Court Trust did is at best immoral, because taking advantage a weakness to take someone else’s property is called a scam anywhere on Earth and getting an $800,000 home for less than $10,000 is no different.
I am NOT an attorney and don’t know Jack about legalities involved in this case but this is the United States and banks simply do NOT lose these kinds of cases. Not because banks can’t write off the losses, but because it looks bad.
When these Las Vegas foreclosures HOA investors listed their homes for sale, or more accurately, their interest in those homes in the Las Vegas MLS at significant discounts, I did not even consider them.
I believe that when it is all done, these real estate investors will lose the case and their homes and while they will receive some interest on their HOA liens it will be more than offset by their legal fees.
Easy come, easy go and if the banks can get away with bringing down the world economy, they can beat the tar out of these Las Vegas foreclosures HOA lien investors. We will see, I guess.
This blog is an update for NEVADA SUPREME COURT RULING ON HOA FEES GUIDE