This episode of Take It To The Board sheds light on a legal process that may be needed to help both struggling associations and their individual members. In these challenging economic times, more people are asking whether filing for bankruptcy protection is the right decision for an individual or a struggling community association. Host Donna DiMaggio Berger speaks with attorney and founder of Bast Amron LLP, Jeffrey Bast about the bankruptcy process from start to finish and how it can be used as a successful strategic tool to navigate financial challenges. Jeff has practiced in the insolvency and litigation arena for 30 years.
Together, Donna and Jeff dissect the implications of chapters 7, 11, and 13 of the US bankruptcy code, highlighting how Chapter 11 might serve as an unexpected lifeline for community associations wrestling with serious financial problems like soaring insurance premiums, costly statutory requirements and large damage awards resulting from litigation. They explore the unique and compelling circumstances that may prompt Homeowners Associations (HOAs), condominiums, or cooperative associations to contemplate filing for bankruptcy as a last resort.
Donna and Jeff also venture into the thorny realm of involuntary bankruptcy. Picture being thrust into bankruptcy by your creditors – daunting, right? They demystify this process, highlighting the twin requirements of authority and transparency. They also look at the historical stigma attached to bankruptcy and aim to debunk the misconceptions around this legal process. This episode of Take It To The Board brings a fresh perspective to understanding bankruptcy and how a reorganization might become a more frequent option for struggling associations. The potential of a bankruptcy is not just about failure or a last resort but also about strategy, planning, and ultimately financial survival.
Conversation Highlights Include:
- The main differences between Chapters 7, 11, and 13 of the US Bankruptcy Code and what’s best for community associations and individuals
- Alternative solutions to explore before considering bankruptcy
- How to know when bankruptcy is your last/best resort?
- What type of authority does a board need to have to pursue a bankruptcy filing?
- What is the lasting impact of a bankruptcy on individuals and entities?
- What is the effect on resales within the community if there is a pending bankruptcy?
- Key questions your bankruptcy attorney should ask!
About Take It To The Board
Think you know what community association life is all about? Think again. Residents must obey the rules, directors must follow the law, and managers must keep it all running smoothly. Take It To The Board explores the reality of life in a condominium, cooperative or homeowners’ association, what’s really involved in serving on its board, and how to maintain that ever-so-delicate balance of being legally compliant and community spirited. Leading community association attorney Donna DiMaggio Berger acknowledges the balancing act without losing her sense of humor as she talks with a variety of association leaders, experts, and vendors about the challenges and benefits of the community association lifestyle.
If you’ve got a question, Take It To The Board with Donna DiMaggio Berger – We Speak Condo & HOA!