Software, data and analytics company Black Knight has launched HOA Property Indicators to efficiently and cost-effectively identify properties subject to one of the estimated 351,000 homeowners’ associations (HOAs) nationwide. With more than 27 million housing units and over 73 million residents subject to HOAs, lenders, servicers and capital markets professionals need an easy-to-use, scalable method for accurately identifying these properties to streamline originations and help mitigate risk, the company said.
Black Knight’s HOA Property Indicators solution quickly and automatically identifies properties subject to an HOA. Used when performing due diligence, assessing lender portfolio risk and monitoring potential risk for investors and government service organizations, it provides an easy-to-identify “yes” or “no” flag so users can efficiently confirm HOA status and focus on these properties, as appropriate.
HOA Property Indicators is part of Black Knight’s HOA solutions suite, which includes data and services that help with everything from identifying properties within an HOA to curing HOA delinquencies.
“In this escalated risk environment, it is increasingly important for lenders, servicers and investors to quickly identify properties in HOAs,” said Ben Graboske, president of Black Knight Data & Analytics. “Our comprehensive suite of HOA solutions provides a cost-effective and efficient way for lenders to streamline their origination processes, for servicers to be more proactive in protecting their loan portfolios and to help reduce risk for the secondary market, particularly for properties in HOA super-lien states.”
There are now 22 “super lien” states in the U.S., along with Puerto Rico and the District of Columbia, where state statutes and/or case law allow for an HOA foreclosure to receive priority over a first-lien mortgage. These super liens can lead to significant losses for servicers and investors, the company said. Combined with current and anticipated increases in forbearances, loan modifications and delinquencies, identifying and monitoring HOA properties and delinquent HOA fees in loan portfolios has become even more critical. Additionally, properties in HOAs often require additional due diligence during the loan origination process.
