[quote=chavous1]How do HOA’s have the power to foreclose on property owned by the bank? If the homeowner is not in default with the bank, how can this occur? Who really owns the property, the bank or the HOA?[/quote]
Your question is a bit muddled but I will answer to what I think you are asking.
If the bank has already foreclosed and is now a homeowner themselves, they are subject to any liens just like a normal owner. Further, if they are a first mortgage (and they almost always are these days) then they own it outright and therefore have 100% equity. If they go several months without paying their HOA dues (which happens often), the HOA can file a lien or even foreclose on the owner (the bank) who is delinquent. The HOA dues are an encumbrance just like any other loan or lien. The issue from before was that if you (as an individual homeowner) have 2 loans and no equity (like most of my clients) then it would be stupid for the HOA to foreclose on you. They would foreclose just to be able to assume responsibility for a property that is upside down.
