In a homeowners’ association, anyone who buys a home becomes a part of the association immediately. As a member of the association, they need to meet the rules and regulations of the community. They need to pay dues, if dues are required, and will need to keep the property in the condition required by the HOA.
A homeowners’ association may place a lien on a homeowner’s property in some specific circumstances, such as if the homeowner defaults on their dues. If the HOA does this, it will make it difficult for the homeowner to sell their property or to refinance if they want to change their mortgage.
Can a homeowners’ association cause your home to go into foreclosure?
It is possible that the HOA’s lien could lead to foreclosure. The HOA may have the right to initiate foreclosure proceedings if the lien is approved. This is why it’s important to talk to the HOA before a lien is established and to try to resolve any problems that have arisen. If you can’t do this, then you may need a defense against the lien or against foreclosure proceedings to keep your home.
How can you handle an HOA lien on your property?
The typical response is to pay back any money that is owed to the HOA to get the lien released. If you are able to pay toward the debt owed and work out a repayment plan, the HOA may decide not to pursue foreclosure.
However, if you cannot repay what you owe, then the HOA may turn to judicial or nonjudicial foreclosure. The first requires the HOA to go to court, but the second does not.
It’s not likely that your HOA will try to foreclose on your property if you only owe a small debt, like a few hundred dollars. However, if that debt grows to thousands, then you can expect to face an HOA lien at the very least. Your HOA will reach out about the debt in advance. You may have a defense against a foreclosure and be able to negotiate to settle the lien, but you need to act quickly.