Link copied to your clipboard

HOA lien on your house? Here are your options

Can an HOA put a lien on your house? Surprisingly, the answer is yes — here’s how to remove an HOA lien on your house.

Lindsay VanSomeren
October 31, 2023
Updated:

You might also like:
A picture of a yellow and blue box.
A picture of a yellow and blue box.

Get up to $500k from your home equity.

  • No monthly payments
  • No income requirements
Prequalify now

Get more from your home wealth

  • Get up to $500k with no monthly payments
  • No income requirements
Create my estimate
Share on social:

Nearly one out of every three homeowners live with a homeowner’s association (HOA) today, and that number is going up every year as 60% of new single-family homes fall within the bounds of these planned communities.

HOAs can offer numerous benefits like better infrastructure and freedom from eyesores, but they can come with drawbacks too. These organizations can wield a lot of power, and the way they work can vary a lot between states and even individual neighborhoods. That can make it tough to know your options if you have an HOA lien and foreclosure on your house, but there are ways to fix it.

What is an HOA lien?

If you buy a house in a planned community, it’ll typically be governed by an HOA that was set up and registered as a corporation by the developer who built all of the homes. HOAs are created to offer more neighborhood services like pools and parks, and ensure everyone in the community adheres to certain standards.

Each HOA is governed by board members elected from among your neighbors, although many HOAs hire management companies to help with the day-to-day operations. HOAs typically collect monthly fees and special assessments to pay for these services. If you run afoul of the rules, your HOA may also assess fines.

HOAs have a lot of power as outlined by each group’s bylaws and Covenants, Conditions, and Restrictions (CC&Rs), the legal documents you agreed to when you purchased your home. These rules — and what the HOA does when you break them or have unpaid fees — can vary a lot between groups. Further complicating matters, the lengths your HOA can go to varies in a patchlike manner across the country depending on what state you live in.

However, in each state, your HOA can put a lien on your property if you have unpaid dues or violations. An HOA lien can make it difficult or impossible to sell your home, gain access to credit, and it can set in motion a series of events that even results in an HOA foreclosure of your home.

hoa-lien

Can an HOA put a lien on your house?

The short answer is yes. An HOA lien is a type of statutory lien, meaning it gives your HOA property rights to your home automatically — as soon as you’re overdue on your HOA fees — without even filing a lien. Some states still require HOAs to record a lien with your county land records office to make it a matter of public record, while some don’t. Depending on the terms in your CC&Rs, your HOA may also put a lien on your house if you’re not in compliance with your community’s rules.

The CC&Rs for your HOA outline the exact steps they’ll take next. They may send you an overdue payment or lien notice, try to call you, limit your access to community property, or hire debt collectors. Your HOA may also levy additional fees, interest, and attorney charges to your outstanding bill, causing it to increase beyond your actual unpaid dues.  

If you don’t pay your outstanding balance, your HOA can also foreclose against your home. Some states have time and monetary limits governing when HOAs can do this, but not all. In California, for example, your HOA can’t foreclose on you unless you’ve been overdue for at least a year or have more than $1,800 in unpaid HOA fees. Texas, on the other hand, has no such laws, allowing HOAs to foreclose on homes for any unpaid dues, however small.

Depending on state laws, your HOA may be required to file a lawsuit and obtain a judgment lien before foreclosing on your home. In many states, HOAs are allowed to proceed with non-judicial foreclosures, allowing them to sell your home at auction without going through the courts first.

Implications of an HOA lien

Aside from the possibility of losing your home, an HOA lien can wreak havoc in many other ways as well, including:

  • Adding increased stress in your life.
  • Straining your relationship with your neighbors.
  • Making it more difficult or impossible to sell your home.
  • Reducing your ability to borrow against your home equity.
  • Requiring contact with debt collectors, lawyers, and court officials.
  • Increasing your costs via added attorney’s fees, interest, and other penalties.
  • Having your wages or bank account garnished if a judge rules against you in court.
  • Harming your credit score and making it tougher to get approved for credit or subsequent housing.

Preventing HOA liens

The simplest thing you can do to prevent an HOA lien is to stay up-to-date on your HOA or condo dues and stay in compliance with your community rules. Putting your HOA payments on autopay is an easy way to avoid forgetting this important task.

However, sometimes we fall behind on finances and if a property owner fails to pay unpaid assessments, it’s not always their direct fault. If you find yourself in these shoes, it’s important to keep an open line of communication with your HOA, as uncomfortable as it may be at first.

Your HOA may be able to offer assistance, such as setting up an interest-free payment plan for delinquent assessments, which may be able to help stave off additional attorney’s fees and charges from your balance. Make sure you keep copies of any correspondence in writing in case you need to refer to it later. Other options to pay off your unpaid assessments could include things like:

  • Personal loans
  • Selling personal property
  • Home equity investments
  • Home equity loans and HELOCs
  • Borrowing from friends and family

It’s also a good idea to consult the bylaws and CC&Rs for your HOA, which will outline the exact procedures and timelines you can expect various actions to be taken. Check to see if your state has HOA foreclosure laws in place as well, which may limit their power to evict you and sell your home.

You may need to consult a real estate attorney if you’re unable to reach a resolution with your HOA. This can be especially important given the nuances of state laws governing HOAs, and because many HOAs also hire attorneys to pursue homeowners for unpaid dues. If you can’t afford a lawyer, there are many options for free legal assistance, affordable credit counseling, and other community resources that you can find help locating through 211.org.

Final thoughts

Dealing with an HOA lien can be scary, but you have many more options available to you than you might think. Once you’ve cleared up the amount due, make sure to request a Lien Release form from your HOA as future proof that the situation has been resolved. Finally, if you have the bandwidth, you can also consider joining the board of your HOA to change the rules from within or even to dissolve the organization if you can get enough neighbors on board.

No income? No problem. Get a home equity solution that works for more people.

Prequalify in 60 seconds with no need for perfect credit.

Show me my offer

No income? No problem. Get a home equity solution that works for more people.

Prequalify in 60 seconds with no need for perfect credit.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form. Please refresh the page and try again.
Get home equity, homeownership, and financial wellness tips delivered to your inbox.

Thank you for subscribing!

Check your email for a confirmation. We’ll be in touch soon!
Success!
Oops! Something went wrong while submitting the form.

Frequently Asked Questions

No items found.

Point in the media

Our innovative products have been featured in top publications.

Business Insider
Point CEO, Eddie Lim made Business Insider's 100 people who are transforming business
Every year, Insider surfaces 100 leaders across 10 industries who are driving unprecedented change and innovation. Lim, the CEO and cofounder of Point, wants to make it easier for people to tap into that wealth. Lim’s company, which he founded alongside Eoin Matthews in 2015, offers homeowners lump sums of cash in exchange for a stake in their home.
Read this article
TechCrunch
Point closes on $115M to give homeowners a way to cash out on equity in their homes
Historically, homeowners could only tap into the equity of their homes by taking out a home equity loan or refinancing. But a new category of startups has emerged in recent years to give homeowners more options to cash in on their homes in exchange for a share of the future value of their homes.
Read this article