Alterra’s collection process is continuously refined and supervised by expert community association attorneys to ensure compliance with statutory requirements and to capitalize on the latest and most effective methods for securing recovery. Each file is evaluated at key stages of our collection process to ensure that the most appropriate collection method is being employed.
Collection Process Overview
Alterra’s process begins with formal legal correspondence to the homeowner demanding immediate payment of the delinquent amount owed plus the collection fees and costs incurred. This correspondence encloses the Association’s collection policy, an itemized statement of the amount owed, and additional disclosures required under state and federal statutes. If the homeowner fails to remit payment, the process continues with the recording of a delinquent assessment lien (“Lien”) against the homeowner’s property pursuant to California law. If the homeowner’s account is not brought current within thirty (30) days, or the homeowner fails to enter into a payment plan, the process continues with recording a Notice of Default (“NOD”) which formally begins the non-judicial foreclosure process.
At this stage an attorney will review the file along with pertinent information about the property and the homeowner to determine what collection route is the most appropriate for the association moving forward (e.g., continuing with the non-judicial foreclosure action or filing a lawsuit against the homeowner to obtain a money judgment). There are numerous factors that impact this determination, such as the amount of equity in the property and the homeowner’s employment/financial status. Once the review of the file and pertinent property/homeowner information is complete, the association is provided with Alterra’s recommendation as to how to proceed.
Matters are typically resolved before the NOD stage by the homeowner’s payment in full of the entire delinquent amount owed plus the collection fees and costs incurred. However, if a homeowner fails to make timely payment, the matter may conclude with foreclosure of the subject property and/or a money judgment obtained against the homeowner that is then collected through tools such as a a wage garnishment or bank account levy.
This information is of course a basic overview of the assessment collection process. The process involves numerous, statutorily-required steps and each matter may be impacted by events such as payment plan requests, bankruptcy filing, or foreclosure of the property by a first trust deed holder. Alterra’s process is built to accommodate all potential scenarios and to secure the best recovery possible for the association.