Residential or commercial property and Conveyances" Subtitle IV. Common Interest Communities" Chapter 18. Residential Or Commercial Property Owners' Association Act" Article 3. Operation and Management of Association" § 55.1-1833. Lien for evaluations; foreclosure
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§ 55.1-1833. Lien for evaluations; foreclosure.

A. The association shall have a lien, when refined, on every lot for unpaid evaluations levied against that lot in accordance with the arrangements of this chapter and all legal provisions of the statement. The lien, as soon as improved, shall be prior to all other subsequent liens and encumbrances other than (i) real estate tax liens on that lot, (ii) liens and encumbrances tape-recorded prior to the recordation of the declaration, and (iii) sums overdue on and owing under any mortgage or deed of trust tape-recorded prior to the perfection of such lien. The arrangements of this subsection shall not impact the priority of mechanics' and materialmen's liens. Notice of a memorandum of lien to a holder of a line of credit deed of trust under § 55.1-318 shall be provided in the same style as if the association's lien were a judgment.

B. The association, in order to best the lien provided by this area, shall file, before the expiration of 12 months from the time the first such assessment became due and payable in the clerk's workplace of the circuit court in the county or city in which such advancement is situated, a memorandum, confirmed by the oath of the principal officer of the or such other officer or officers as the statement may define, which contains the following:

1. The name of the development;

2. A description of the lot;

3. The name or names of the persons making up the owners of that lot;

4. The amount of overdue evaluations currently due or unpaid relative to such lot together with the date when each fell due;

5. The date of issuance of the memorandum;

6. The name of the association and the name and existing address of the individual to contact to schedule payment or release of the lien; and

7. A statement that the association is obtaining a lien in accordance with the arrangements of the Residential or commercial property Owners' Association Serve as stated in Chapter 18 ( § 55.1-1800 et seq.) of Title 55.1.

It shall be the duty of the clerk in whose workplace such memorandum is filed as supplied in this area to record and index the like supplied in subsection D, in the names of the persons recognized in such memorandum along with in the name of the association. The cost of recording and launching the memorandum will be taxed versus the individual found liable in any judgment or order imposing such lien.

C. Prior to submitting a memorandum of lien, a written notice will be sent out to the residential or commercial property owner by certified mail, at the residential or commercial property owner's last known address, informing the residential or commercial property owner that a memorandum of lien will be submitted in the circuit court clerk's workplace of the appropriate county or city. The notification will be sent at least 10 days before the real filing date of the memorandum of lien.

D. Notwithstanding any other provision of this section or any other arrangement of law needing files to be tape-recorded in the miscellaneous lien books or the deed books in the clerk's office of any court, on or after July 1, 1989, all memoranda of liens occurring under this area will be recorded in the deed books in the clerk's workplace. Any memorandum shall be indexed in the basic index to deeds, and the basic index shall recognize the lien as a lien for lot assessments.

E. Any lien perfected pursuant to subsection B might be imposed by filing a civil action to perform a judicial foreclosure in the circuit court in the county or city where the lot lies or by nonjudicial foreclosure pursuant to subsections I and J. No foreclosure of any lien perfected under this section shall be initiated after 120 months from the time when the memorandum of lien was tape-recorded. The filing of a civil action to enforce any such lien by foreclosure through judicial means or issuance of notice of nonjudicial foreclosure under neighborhood J 1 will be regarded as the organization of an action under this area. Nothing in this subsection will extend the time within which any such lien may be perfected.

F. The judgment or order in an action brought pursuant to this section shall include compensation for costs and sensible lawyer charges of the dominating party. If the association prevails, it might likewise recuperate interest at the legal rate for the sums secured by the lien from the time each such amount became due and payable.

G. When payment or fulfillment is made from a debt secured by any lien improved pursuant to subsection B, such lien shall be launched in accordance with the arrangements of § 55.1-339. Any lien that is not so launched shall subject the lien financial institution to the charge set forth in subdivision B 1 of § 55.1-339. For the functions of § 55.1-339, the primary officer of the association, or any other officer or officers as the statement may define, will be deemed the duly licensed representative of the lien lender.

H. Nothing in this area shall be interpreted to restrict actions at law to recover amounts for which subsection A produces a lien, maintainable pursuant to § 55.1-1828.

I. The association might perform a judicial or nonjudicial foreclosure sale upon a lot versus which the association has improved several liens pursuant to this section if the overall amounts secured remain in excess of $5,000, exclusive of lawyer charges and expenses. For functions of this section, the association will have the power both to offer and convey the lot and shall be considered the lot owner's statutory agent for the function of moving title to the lot.

J. A nonjudicial foreclosure sale shall be conducted in compliance with the following:

1. The association will provide notification to the lot owner prior to ad needed by subdivision 4. The notice shall define (i) the debt protected by the improved lien; (ii) the action required to satisfy the financial obligation secured by the perfected lien; (iii) the date, not less than 60 days from the date the notification is offered to the lot owner, by which the financial obligation secured by the lien needs to be pleased; and (iv) that failure to satisfy the financial obligation secured by the lien on or before the date defined in the notice might result in the sale of the lot. The notice will further inform the lot owner of the right to bring a court action in the circuit court of the county or city where the lot lies to assert the nonexistence of a financial obligation or any other defense of the lot owner to the sale.

2. After expiration of the 60-day notification period defined in neighborhood 1, the association may appoint a trustee to perform the sale. The visit of the trustee shall be submitted in the clerk's office of the circuit court in the county or city in which such advancement is situated. It shall be the task of the clerk in whose workplace such consultation is filed to tape-record and index the same as supplied in subsection D, in the names of the persons identified in such appointment along with in the name of the association. The association, at its choice, may from time to time get rid of the trustee and appoint a follower trustee.

3. If the lot owner satisfies the conditions specified in this subdivision prior to the date of the foreclosure sale, the lot owner will deserve to have enforcement of the refined lien ceased prior to the sale of the lot. Those conditions are that the lot owner (i) please the debt secured by lien that is the subject of the nonjudicial foreclosure sale and (ii) pay all expenses and expenses incurred in perfecting and enforcing the lien, including advertising costs and sensible attorney costs.

4. In addition to the ad needed by subdivision 5, the association shall offer written notice of the time, date, and location of any proposed sale in execution of the lien, consisting of the name, address, and telephone number of the trustee, by hand delivery or by mail to (i) the present owner of the residential or commercial property to be offered at his last recognized address as such owner and address appear in the records of the association, (ii) any lienholder who holds a note against the residential or commercial property secured by a deed of trust taped a minimum of 30 days prior to the proposed sale and whose address is recorded with the deed of trust, and (iii) any assignee of such a note protected by a deed of trust, offered that the project and address of the assignee are also tape-recorded a minimum of thirty days prior to the proposed sale. Mailing a copy of the ad or the notification containing the same details to the owner by licensed or registered mail no less than 14 days prior to such sale and to lienholders and their assigns, at the addresses noted in the memorandum of lien, by United States mail, postage prepaid, no less than 2 week prior to such sale, will be an enough compliance with the requirement of notification.

5. The advertisement of sale by the association shall be in a paper having a general flow in the county or city in which the residential or commercial property to be sold, or any part of such residential or commercial property, is located pursuant to the list below provisions:

a. The association shall advertise when a week for four succeeding weeks; nevertheless, if the residential or commercial property or some part of such residential or commercial property is situated in a city or in a county right away adjoining to a city, publication of the advertisement on 5 various days, which may be consecutive days, will be considered sufficient. The sale shall be hung on any day following the day of the last advertisement that is no earlier than eight days following the very first advertisement nor more than 1 month following the last ad.

b. Such advertisement will be positioned in that area of the newspaper where legal notifications appear or where the kind of residential or commercial property being offered is generally marketed for sale. The advertisement of sale, in addition to such other matters as the association discovers suitable, will set forth a description of the residential or commercial property to be offered, which description need not be as substantial as which contained in the deed of trust however will determine the residential or commercial property by street address, if any, or, if none, shall offer the general place of the residential or commercial property with recommendation to streets, paths, or known landmarks. Where readily available, tax map identification may be used but is not required. The advertisement shall also consist of the date, time, place, and regards to sale and the name of the association. It will set forth the name, address, and phone number of the agent, representative, or lawyer who may be able to respond to inquiries concerning the sale.

c. In addition to the advertisement needed by neighborhoods a and b, the association may even more market as the association discovers appropriate.

6. In case of post ponement of sale, which postponement will be at the discretion of the association, advertisement of such held off sale will remain in the same way as the initial advertisement of sale.

7. Failure to adhere to the requirements for advertisement contained in this area shall, upon petition, render a sale of the residential or commercial property voidable by the court.

8. The association shall have the following powers and responsibilities upon a sale:

a. Written one-price quotes might be made and will be gotten by the trustee from the association or anyone for entry by statement at the sale. Anyone aside from the trustee may bid at the foreclosure sale, consisting of a person who has submitted a composed one-price bid. Upon request to the trustee, any other bidder in presence at a foreclosure sale will be permitted to check written bids. Unless otherwise provided in the statement, the association may bid to purchase the lot at a foreclosure sale. The association might own, rent, encumber, exchange, sell, or communicate the lot. Whenever the composed bid of the association is the highest quote submitted at the sale, such composed quote shall be filed by the trustee with his account of sale required under subdivision J 10 and § 64.2-1309. The written quote sent pursuant to this subsection may be prepared by the association, its representative, or its attorney.

b. The association might require any bidder at any sale to publish a money deposit of as much as 10 percent of the list price before his quote is gotten, which shall be reimbursed to him if the residential or commercial property is not offered to him. The deposit of the successful bidder will be applied to his credit at settlement, or, if such bidder fails to finish his purchase quickly, the deposit will be applied to pay the expenses and expenditures of the sale, and the balance, if any, will be maintained by the association in connection with that sale.

c. The association shall receive and invoice for the profits of sale, no purchaser being needed to see to the application of the proceeds, and use the very same in the following order: first, to the affordable expenses of sale, including attorney fees; second, to the fulfillment of all taxes, levies, and assessments, with expenses and interest; 3rd, to the complete satisfaction of the lien for the owners' assessments; fourth, to the satisfaction in the order of concern of any remaining inferior claims of record; and 5th, to pay the residue of the earnings to the owner or his assigns, offered, however, that, as to the payment of such residue, the association will not be bound by any inheritance, design, conveyance, project, or lien of or upon the owner's equity, without real notification thereof prior to circulation.

9. The trustee will provide to the buyer a trustee's deed conveying the lot with special service warranty of title. The trustee shall not be needed to take ownership of the residential or commercial property prior to the sale of such residential or commercial property or to provide ownership of the lot to the buyer at the sale.

10. The trustee will submit an accounting of the sale with the commissioner of accounts pursuant to § 64.2-1309, and every account of a sale will be recorded pursuant to § 64.2-1310. In addition, the accounting shall be made available for examination and copying pursuant to § 55.1-1815 upon the written request of the prior lot owner, the existing lot owner, or any holder of a taped lien versus the lot at the time of the sale. The association will preserve a copy of the accounting for a minimum of 12 months following the foreclosure sale.
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11. If the sale of a lot is made pursuant to subsection I and the accounting is made by the trustee, the title of the purchaser at such sale shall not be disrupted unless within 12 months from the verification of the accounting by the commissioner of accounts the sale is reserved by the court or an appeal is filed in the Court of Appeals or approved by the Supreme Court and an order is gotten in requiring such sale to be set aside.

1989, c. 679, § 55-516; 1991, c. 667; 1997, cc. 760, 766; 2000, c. 905; 2004, cc. 778, 779, 786; 2019, c. 712; 2021, Sp. Sess. I, c.