HOA Debt Collection II: The HOA-ening

When we last left the good folks of the Silver State (Nevada — aka The Sagebrush State, aka The Battle Born State, aka Vicky), everyone was suing everyone else. A quick rundown:

• Three collection agencies –  Nevada Association Services, RMI Management, and Angius & Terry Collections — filed a restraining order against a decision levied by the commissioner of Nevada’s Financial Institutions Division.
• Two homeowners file a suit against Nevada Association Services, claiming Fair Debt Collection Practices Act (FDCPA) violations.
• Nevada Association Services president David Stone threatens to countersue.
• Nevada Association Services, RMI Management, and Angius & Terry Collections file suits against an entire cadre of defendants, including Nevada sibling-attorneys Puoy (sister) and Rutt (brother) Premsrirut.
• Puoy and Rutt Premsrirut file suits against almost every collection agency in Nevada and your mom.
• Bank of America files suits against several Nevada HOAs *and* several collection agencies.
• Catherine Martel hides a second set of books from Josie Packard.

Now, two Arizona senate bills walk into a bar: SB 195 and SB 243. Both want to limit the amount of fees collection agencies can tack on consumers’ outstanding debt.

SB 195 is sponsored by Las Vegas Republican Senator (and friend of Joe the Plumber) Elizabeth Halseth, along with 10 other Nevadan lawmakers. It would cap collection fees at $1,200.

Democratic senator Allison Copening’s SB 243 would establish set fees for certain services.

Neither is a done deal — especially Copening’s. An article in the Las Vegas Review Journal suggests that Copening might pull her bill — which would be an inefficient way to get her point across — in favor of a regulatory move that would effectively cap collection agency fees at $1,950. The article says that the regulatory change would go into effect more quickly than a bill.

Copening is no friend of the Industry: “Collection agencies are crafty,” she’s quoted as saying. “They will look for ways to get around this bill.”

And they might — but not because they’re crafty. From the looks of it, the rates are being set not based on anything tangible, like what it costs to run a business with trained professionals. Instead, it appears to be set by emotion — specifically, the emotions of folks who are in dutch to their HOA and aren’t pleased to be dealing with collection agencies in the first place.

When it was later revealed that the proposed caps wouldn’t cover “reasonable attorneys’ fees,” homeowner Jonathan Friedrich got philosophical:

“What is reasonable to me may not be reasonable to the collection agency,” he said. It’s probably fair to assume — though it is an assumption — that in those instances, Friedrich would rather he be the model of reasonableness.

No action has yet been taken on any of the bills — other than a lot of testimony and impassioned statements. We’ll bring you Part III as we get more info.