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Feldsott Lee Pagano & Canfield
Orange County Homeowners Association Law Firm

Homeowners' association boards and debt collection

One of the most unenviable jobs for any California business is collecting overdue debts. Homeowners' association boards are not immune to this task. Without the funds from homeowners' dues and assessments, boards cannot operate. This means that they will need to have a plan in place for collecting monies from homeowners who fail to meet their financial obligations to the HOA.

HOAs use three legal avenues for collecting past due assessments and debts. One option is to record an assessment lien on the home, which may later be used to file a judicial foreclosure. Another option is to file a court action against the owner personally. Finally, the board may use a private sale to foreclose on a lien.

The news is full of stories that place HOA boards in a negative light for enforcing their obligation to collect monies owed to them. In some cases, it may be better to attempt less confrontational methods to try to obtain payment. However, when an HOA member continues to resist less adversarial means, legal action may be the only course of action.

Few people enjoy being the "bad guy" when it comes to collecting a debt, but it is a necessary part of business. When homeowners' association boards have issues with members who are behind on their dues and assessments, it may be a good idea to consult with a California attorney who routinely represents HOA boards under these circumstances. It is important to make sure to follow all of the legal steps necessary in order to ensure that nothing comes back on the board and the rights of all parties are taken into consideration throughout the process.

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