Ninth Circuit: Nevada Condo Law That Gives Superpriority For Unpaid HOA Assessments Is Preempted By Federal Statute That Protects Freddie Mac

LexisNexis (September 26, 2017, 2:19 PM EDT) -- Over the last five years, we have seen some notable pieces of litigation around the country between "first-priority" real estate mortgages and condo homeowner associations (HOA) armed with state "super-priority" statutory liens for unpaid assessments.  This priority litigation occurs after the owner of a condo or a coop apartment defaults on both the mortgage and the HOA assessments on the condo unit.  Mortgagees are now coming to the realization that their "first-priority" mortgage may be wiped out by a "super-priority" claim of an HOA. A non-judicial foreclosure sale by the HOA could eliminate an entire mortgage that was recorded long before any HOA assessments were levied. Two of the leading cases are SFR Investments Pool I, LLC v. U.S. Bank N.A., 2014 Nev. LEXIS 126 (Nev. 2014) and Chase Plaza Condo Ass'n v. JP Morgan Chase Bank, N.A., 98 A.3d 166, 2014 D.C. App. LEXIS 317 (D.C. Cir 2014). ...