What Happens When You Don't Pay Your HOA Fees?

Real Estate Agent with West USA Realty Revelation

Recently I discovered what happens in Arizona when you don't pay your HOA fees.  I unfortunately found out the hard way when a process server knocked on my door and served me some legal papers.  I had always thought that HOA fees were simply a lien against the home when they were not paid.  This thinking was incorrect at least in Arizona.  In Arizona HOA fees only stay on the property until the property is sold or foreclosed upon.  At that time HOA fees are the responsibility of the person whom owned the property at the time that the fees were assessed.  In other words, HOA fees become a personal obligation rather than staying as a lien on the property.  I was presented with a bill for all the back HOA fees as well as late charges and legal fees associated with the collection.  Fortunately, I was able to work out a deal with the HOA and get the HOA fees reduced but if it was not for them negotiating it I would have had to pay about 2 or 3 times the amount that I had actually owed for the HOA fees.  I know that I am not alone when it comes to not paying HOA fees.  Many people whom are behind on their payments are not paying and are probably thinking the same way that I did.  They are probably thinking that the HOA will not come after them personally for the past due HOA fees.  The fact is that the HOA can and will in most cases come after the person that owes these fees.

If you are not being foreclosed on then the HOA  can hold the sale up until the HOA fees are paid.  This is because the HOA fees become a lien on the home so long as the person that owned the home at the time that the HOA fees were assessed still owns the home.  The reason that this does not apply in a foreclosure is that the owner does not have any control over the foreclosure.  The foreclosure takes all the rights away from the home owner.  In the case of a foreclosure the only option for the HOA to collect the HOA fees is to put a personal liability on the person that had owned the property.  I hope that by putting this blog out that I am able to inform many people whom otherwise would not know the effects of not paying their HOA fees.

The reason that the HOA will generally come after a person that does not pay is that the HOA is dependant on the HOA fees that they assess.  These HOA fees go to pay for many different things for which the HOA is responsible such as maintaining the common areas.  If these HOA fees are not collected then the HOA will not have the funds to maintain the neighborhoods or subdivisions for which they are responsible.  If these areas are not maintained then the areas will deteriorate and the homes in the area will lose their value which affects everyone in the community.  These HOA fees are a must for the HOA to collect and they must pursue them to the best of their ability.  If you are one of those that have considered not paying your HOA fees then you might want to think again.  It could end up costing you way more than you think.


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Tim Lorenz
TIM LORENZ - Elite Home Sales Team - Mission Viejo, CA
949 874-2247

Sorry to here that you got in that legal jam.  It works the same way in CA

Sep 27, 2011 02:10 AM #1
Michelle Carr-Crowe-Selling Silicon Valley Homes in Top Schools San Jose, Cupertino, Saratoga, Palo Alto-Just Call 408-252-8900
Just Call (408) 252-8900! - San Jose, CA
Family Helping Families Buy & Sell Homes 40+ Years
I think this is common in many states, including California.
Sep 27, 2011 02:16 AM #2
Rocky Dole
West USA Realty Revelation - Maricopa, AZ

It is too late to stop what happened to me but maybe I can prevent someone else from having problems by putting this blog out.  Thanks for the comments.

Sep 27, 2011 02:23 AM #3
Pacita Dimacali
Alain Pinel - Oakland, CA
Alameda/Contra Costa Counties CA


This is also one of the things we caution short sale sellers about  --- to at least keep their HOA payments current. Most short sale lenders will not approve paying for HOA-related fines and fees. We know the HOA can foreclose just like any bank.

Glad you ironed that you managed to negotiate with the HOA and you're back on track. Some HOAs won't bend.

Sep 27, 2011 04:57 AM #4
Amy Shair
Cary Apex Durham NC Referrals - RE/MAX United - Search Durham Homes - Duke University, NC
Award Winning Agent 20+ Years

Interesting post. We've seen HOAs foreclosing on properties here, even with 1st and 2nd mortgages. They're trying to get paid rather than the HOA writing the bad debt off. I'm not sure if it can become a personal lien in NC but I'm going to call and find out today.

Sep 27, 2011 07:12 AM #5
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