Condominium associations across Ohio have asked legislators to make them a priority to receive proceeds from the sale of bank foreclosure homes in their buildings. Condominium associations are facing an increase in the number of delinquent monthly dues as a result of the economic downturn, the collapse of the housing market and unemployment crisis resulting to more foreclosures.

Owners of condominium units pay monthly dues to cover the cost of building maintenance, utilities, landscaping and other services. When owners became delinquent on their monthly dues, associations have no choice but either to increase fees for other residents to cover the maintenance costs or cut services.

To remedy this situation, condominium associations have requested the Ohio General Assembly to create superlien laws. Normally, banks are the holders of the primary lien for foreclosure homes, which means that they have the first priority to receive the money from the sale of a foreclosed condominium unit.

But most of the time, the sale price of a foreclosed home could not cover the total mortgage owed to the bank. In these cases, other lien holders, including condominium associations, gained nothing from the sale.

Superlien laws require that condominium associations be paid at least a half-year worth of delinquent fees before the sale money can be divided among primary lenders and other creditors. These laws are being implemented in 13 states and Washington D.C. Condominium associations hope that Ohio would become the 14th state to implement these laws.

Industry experts said that some homeowners’ associations in northeast Ohio are reeling from the effects of the foreclosure crisis. They were forced to cut down on amenities and services such as landscaping and swimming pools.

Ohio earned the 12th position in the nationwide foreclosure ranking in the second quarter of this year. Industry experts are seeing some signs of easing on the foreclosure problem in the state, pointing out that Ohio was the seventh among states with the highest foreclosure rate the previous year. This means that 2.25 percent of the total properties in Ohio were foreclosures last year.

But recent market data showed that foreclosure filings in the state declined about 15 percent in June this year compared with the same month last year.