It seems impossible to watch the news or read the paper these days without hearing about the troubled real estate market, as well as the troubles growing mortgage default rate.  According to the California-based real estate tracking company, RealtyTrac, roughly 2.2 million homes received foreclosure-related warning notices in 2007.  A year earlier in 2006, 1.3 million homes received those warning notices.  Because of mortgage defaults noted at the end of 2007, it is expected that the number of homes to receive foreclosure-related warning notices in 2008 will be even larger.  
 
Evidence shows that the states hardest hit by foreclosures are Nevada, Florida, Michigan and California.  In 2007, New Jersey saw 53,652 foreclosure filings, up 34% from 2006.  New Jersey’s mortgage default foreclosure rate for 2007 was 0.9% (or, less than one property in foreclosure for every 100 properties in New Jersey).  In contrast, the foreclosure rate in 2007 for Nevada was 3.4% and for Florida it was approximately 2%.  Historically, and fairly obviously, the number of defaults in common interest community association and cooperative monthly maintenance fees, HOA fees, special assessment fees, and other condo fees increase as well during times of increased mortgage defaults.  
 
In turn, it is even more imperative that associations and cooperatives act aggressively to ensure payments are made early in any deficiency.  For associations, it is essential that liens be recorded early to ensure protection in the event of an owner’s bankruptcy and to secure a better position in the face of any mortgage foreclosure.