08/30/2026
Please take heed of these three free nuggets of information. I feel terrible when I come across clients who have slid into a terrible financial predicament because of not knowing these things (per my observations in the state of South Carolina).
1. HOA fees are just as enforceable as mortgage/note payments. Even if you're up to date on your mortgage, your home can be foreclosed upon for failure to pay HOA fees.
2. If you are using a company or organization to consolidate and reduce your debt, you may be receiving a 1099 from your creditor, and a bill from your taxing authority reflecting the forgiven amount as income to you. Example: You owe a $5,000.00 credit card bill. The company agrees to allow a reduction of your interest rate and balances, relieving you of $3,000.00 of the debt (just a hypothetical, everybody). The remaining $2,000.00 may be considered as "taxable income". While it's better than paying it dollar per dollar, just be prepared to pay taxes on the forgiven amount. (Participation in a successful "fresh start" or "debt reorganization" bankruptcy addressing the debt may serve to avoid deeming of the forgiven amount as taxable "income".
3 If you receive a Summons and Complaint from a creditor, issued by the court, DO NOT PUT IT IN THE DRAWER OR IGNORE IT. Anybody at your home over 18 years of age can be served with a lawsuit on your behalf. There are some exceptions; however, the clock begins to tick upon the date it is served. The Summons will note that you have thirty (30) days to file an Answer in court, AND have the attorney or creditor (Plaintiff) served a copy before the 30 days are up. Regardless of how ridiculous you think the suit may be or that you do not owe the claimed debt or are otherwise liable, failure to properly file AND serve the written Answer may result in a lien against your home and/or other property. A phone call to enemy camp does not count. The court order issued against you will be called a "default judgment," which remains active for ten (10) years and bears a high interest rate for which you may be responsible.
Be sure to arrange a consultation with a lawyer if you have legal concerns. Best wishes!
This community education note from Eddye L. Lane, P.A. is not legal advice for any particular person and their particular circumstance, and does not create an attorney-client relationship between the attorney and the reader.
