The ADAC Process

There are several ways to attempt to collect a debt from a home owner, but after years of taking many of these steps, our Founder and CEO - himself a liscensed attorney in Michigan, Hawaii, Missouri and Illinois - had come to the conclusion that the best and only cost effective way to recover a home owner's assessment delinquency is to attach the debt to the real property in the form of a Lien, and to use the foreclosure option afforded to the Association to take possession of the property to rent or sell if the owner is unwilling or unable to pay off the debt.

For this reason, ADAC has narrowed our collection process to this statutory action only. There are several avenues a collection agency might take to attempt collection of the debt which ADAC will not pursue. However, by narrowing our focus to only this process, we have developed the highest level of expertise and experience at pursuing the avenue which has the highest probability of success while remaining cost effective.

Our major steps are only a form in which to begin because each Association is different in need and each State has its own unique laws and time requirements. Please contact ADAC for more information.

Click here for State Specific Process Steps.



The 3 General Stages of Our Process

  • FDCPA Notice and Initial Demand Letter

    During this first stage, ADAC sends a Fair Debt Collection Practices Act (FDCPA) notice to the owner identifying the unpaid obligation, name of the creditor (the association), name and mailing address of the debt collector (ADAC), and providing the owner(s) with his/her/their right(s) to dispute the validity of the debt within 30 days. At the end of the 30 days, if the owner(s) has/have not disputed and/or resolved the amount owing, a second letter is sent demanding payment of the balance owed and notifies the home owner(s) (where allowed by statute and association governing documents) that the Association has the right to lien the property and to enforce that lien if the owner(s) will not pay the association dues (and associated fees). The format of these letters is personalized for each State and Association.

  • Association Lien

    After the time required by statute, and if the balance owed has not been paid in full by the owner(s), ADAC will have a lien recorded against the property for the amount owed. In some areas updated liens will also be recorded over time as required by State statute and/or association governing documents. In several States, the laws read that associations have an automatic lien on the properties within their communities.  However, to insure protection against bankruptcy, refinancing or selling the property, ADAC does file a lien within the county where your association is located. This lien is picked up by credit agencies, banking institutions, can affect the owner's credit rating, etc.

  • Lien Enforcement - Foreclosure/Eviction

    ADAC always sends the home owner a final warning before beginning any actual enforcement proceedings. This varies by state, but a lien might be enforced in one of the following ways: a non-judicial foreclosure, a judgment lawsuit (with accompanying judicial foreclosure), forecable detainer, or lease termination and eviction. Home owners elevated to this stage are contacted in every viable form to insure proper notification.  Home owners incur significant legal, publication, and processing fees during this stage and each state has its own particular steps required.  ADAC specializes in non-judicial foreclosure, but has used these other methods when necessary to collect what is owed to the association. ADAC also co-operates in Attorney assistance and Attorney support as contracted.




 


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