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Can An HOA Foreclose On Your Home?

Florida has more homeowner associations (HOAs) and condominium associations (COAs) than any state in the country. With so many people living in a managed community, the state has developed a large body of law dedicated to regulating these organizations.

People who choose to live in an HOA agree to follow that organization’s rules. Even if a person owns his or her house outright, the HOA can still control many facets of everyday life, from the types of landscaping allowed to the number of vehicles that can park in a driveway.

While HOAs can regulate nearly everything, how much power do they actually have? Can an HOA foreclose on your home even if you are current with your mortgage?

In short, the answer is yes. Most HOA and COA agreements allow the organization to obtain a lien on the property and institute foreclosure proceedings when a person falls behind on monthly association dues.

In Florida, an HOA can easily begin a foreclosure case. In essence, all the HOA must show is that a homeowner has unpaid assessments, that the homeowner had notice of the delinquency, and that the dues or assessments remain unpaid after the notice.

The HOA must give the homeowner a 45-day demand letter advising them of the delinquency and providing notice of the HOA’s intent to file a lien on the property. If the HOA receives no response to the letter and the dues remain unpaid, the HOA can place the lien and send a notice of intent to foreclose. If the HOA still does not receive a response or payment, the HOA can begin the foreclosure process.

Once the HOA’s foreclosure begins, the cost of clearing the debt can add up quickly. HOAs are allowed to add interest, penalties, late charges, and attorneys’ fees to their lien. Attorneys’ fees alone may be 2-3 times the cost of the actual unpaid assessments.

For many homeowners, it is inconceivable that they may be current on their mortgage but can still lose their house because of their HOA. However, since the HOA contract was part of the property when it was purchased, state law treats HOA dues much like mortgage payments.

The consequences of losing your home to your HOA in foreclosure can be severe. When a person is current on the mortgage but delinquent on the HOA assessments, the HOA can foreclose on the property and take the home subject to the original mortgage. This means that the homeowner would lose his or her house to the HOA, but would still be responsible for paying off the mortgage for the property that he or she no longer owns.

For this reason, it is important to seek legal help immediately if you receive a notice of delinquency from your HOA. If you don’t act quickly to correct the delinquency, an HOA foreclosure could ruin your credit and saddle you with a lifetime of debt. Avoid these consequences by scheduling a free consultation at the Loan Lawyers. Our attorneys will review your HOA claim, and will help you create a plan to protect your financial future.

To schedule a risk-free, confidential consultation with our office about your foreclosure matter, contact us today by calling (888) FIGHT-13 (344-4813).