Action 9 investigates HOA debt collectors

Updated:

A Winter Park woman claims a past-due homeowners association bill for $145 has turned into an astounding demand for $77,000.

Ranya Hamza blames a debt collector that bought old association debts then, she claims, demanded homeowners pay sky-high fees.

Hamza said these are scary times and she fears a debt collector may try to take her home.

“This is killing me," she said. "I can't sleep. I cannot do anything.”

She bought a Winter Park Villas condo in foreclosure but didn't know the previous homeowner owed $145 in association fees.

Then, Hamza claims, out of the blue, LM Funding in Tampa sued to collect the debt that now totaled in the thousands.

“They put a lien on my property just like that, just like that,” she said.

HOAs often hire attorneys to collect unpaid dues, but Hamza faces something new and far more threatening.

The condo association had been struggling so, like many other HOAs, it signed an agreement with LM Funding, which is a debt collector.

LM Funding advanced the association money to cover maintenance bills and in exchange it took over right's to collect delinquent dues, like Hamza’s debt.

But since she first disputed it, Hamza said LM Funding fees soared and now the company claims she owes $77,000.

“And nobody is stopping them,” Hamza said.

Several condo associations are trying to block LM Funding through a recently certified class-action lawsuit.

The suit accuses the company of deceptive trade and illegally high interest rates.

HOA consumer advocates say the practice is way out of bounds.

The bill really adds up quickly believe me you can see it," Jan Bergman, with Cyber Citizens Justice, said. "Click, click, click, and it's up thousands of dollars."

LM Funding told Action 9 that its fees are fully disclosed and denies the claims made in the class-action lawsuit.

Hamza hired an attorney to fight her bill, which includes dues she's not allowed to pay until there is a settlement. 

LM Funding says its debt collection benefits all homeowners, who would otherwise be stuck covering unpaid dues.

LM Funding released the following statement to Action 9:

"I have attached a copy of the estimated safe harbor that the (home owners) associations and their residents are eating because of defaults by nonpaying unit owners, and the banks being able to literally walk away with very limited liability.

This amounts to a tax of approximately $250 estimated for every condo and HOA owner in the state of Florida. At this point no one seems to be really representing these folks.

This is all being left on the backs of the owners that pay.

On the lady you mentioned, if she has paid we will make sure that all this is put behind her. What she is doing is impacting the folks that do pay. They are the ones nobody ever talks about. 

Thanks again for looking into these situations."

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