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David L
David L, Lawyer
Category: Real Estate Law
Satisfied Customers: 3255
Experience:  Attorney licensed in multiple jurisdictions.
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We are in the middle of a mediation between our former HOA

Customer Question

We are in the middle of a mediation between our former HOA in Reno, NV and us. The HOA states while they are not responsible for our problem, but they are willing to settle for a dollar amount if we can come to an agreement. We gave them an earlier amount
of $4,400 but they say that is too much. We lost a short sale because we believe the HOA did not maintain the drainage in the common area correctly. Because of the loss of the short sale, we incurred expenses for HOA assessments, utilities, etc. until we were
able to do a deed in lieu of foreclosure approximately 8 months later in April 2015. We have no idea what our counter over should be?
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  David L replied 1 year ago.

Hi and thanks for asking your question. If the HOA is willing to settle, then it sounds like they are feeling some potential liability if the case went to trial. That's a good thing. If you add up your expenses incurred over the 8 months, how close are they to your $4,400 demand? Also, keep in mind that at mediation neither sides gets exactly what they want. Each side has to compromise to a certain extent, in order to settle the case.

Thus, let's assume that $4,400 represents 100% of your recovery in an ideal world. At a mediation, you would most likely not recover 100%. If $4,400 is your actual costs to date, and the HOA is unwilling to pay that amount, you have to decide whether it's better to offer something lower and reach settlement or hold fast to the higher number. I think it's usually a better idea to settle and get out of litigation.

Come down a little bit and try to find their magic number. Mediation is like a poker game. Each side has to throw numbers back and forth to get some idea where the other side might be willing to settle. In your case, if $4,400 didn't work and you feel strongly about your case, maybe try $4,000 and see where that goes. Then go down a little bit at a time until you don't want to go any lower. At some point in the negotiations, you will get a good feel for where the HOA is willing to go to settle.

Customer: replied 1 year ago.
For such a quick response, you gave us what we need to do with the HOA offer. Thanks.
Expert:  David L replied 1 year ago.

You're welcome. Glad I could help. Feel free to follow up if I can help you further. It's hard to put a firm value on a settlement. It's more of trying to feel out the other side and see how much you can get them to spend. Good luck!