What Can Happen if I Don't Pay My HOA Dues?

Homeowner associations have been suffering the past few years as a result of a large number of homeowners not paying their homeowners association dues. Most of these homeowners are in default on their mortgages as well. Other homeowners in their community have had to pay higher dues and assessments to make up the difference. This has created problems for many associations. Some have even gone broke. Remedies for associations generally include filing a lien against your property, obtaining a judgment or filing a foreclosure against you depending onthe association rules and regulationsand state laws.

Association State Laws

Anumber of states have passed condominium and homeowner association laws that protect associations by allowing them to beable to collect delinquent homeowners association dues from tenants of delinquent homeowners by filing a lawsuit in court. The associations can collect the rental payments, deduct the arrearages and monthly duesand then refund any remaining balanceback to the homeowner.These measures are helping to put HOA's back in the black and out of the red.

Foreclosures and HOA Defaults Affect Other Owners

It has been difficult for associations to collect dues from pre-foreclosure homeowners because the courts and lenders are so backed up with foreclosure matters that homeowners have been staying in their homes for up to a year without paying their mortgage payments or their HOA dues. Other owners have had to pitch in and pay higher dues or assessments in orderto keep their associations solvent so they can maintain the common areas of the building and make repairs.Lenders are not responsible for paying the borrower's HOA dues during the pre-foreclosure stage.Lenders are only responsible for HOA dues from the time they take ownership. Those dues do not get get paid until the lender resells the property. So it could be at least two years before the associations get paid.If you live in a community governed by a condo association, and you want to sell your condo even if you are not upside down, the foreclosure crisis still affects you because in some states like Floridalenders won't even lend in the building if there are more than 10% of homeowners in default. Or the lender may requirethe buyertoput downa much larger down payment. This makes it harder to sellyour property, and may require you to find a cash buyer. Until the foreclosure crisis is solved, everyone is affected.


Measures that HOA's are taking against homeowners who fail to pay their dues include:

  • Suspending homeowners' uses of common areas or their tenants' use of common area privileges
  • Charging late fees, interest and assessments
  • Filing a lien
  • Filing a lawsuit to collect HOA dues by collecting rental payments of homeowners who are in default on their HOA dues
  • Getting a judgment
  • Filing foreclosure against delinquent homeowners' properties

(See more on what you can do if you have been threatened by HOA board members).

Hire an Attorney

If you are involved in a dispute with your HOA over failure to pay your dues or if you are also facing foreclosure, you should speak to a real estate attorney immediately. The attorney can negotiate a settlement with your HOA or lender and represent you in court.

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