Many Arizona property owners are amazed to discovery that Arizona regulation does permit a homeowners’ association to foreclose on a lien against a house owner in certain scenarios. This is not true in each and every condition and was not the situation in Arizona until quite the latest amendments to the Arizona Revised Statutes. In get to steer clear of losing your house to your homeowners’ association, you should realize what rights and obligations you have.
The good news is, Arizona regulation does not permit a homeowners’ association to foreclose against a house owner for unpaid fines. As an alternative, the regulation distinguishes involving assessments and fines, permitting for foreclosure steps primarily based on liens for unpaid assessments, but not fines.
Assessments are outlined as the common dues that a homeowners’ association fees to preserve the neighborhood. If a house owner fails to spend such assessments, and if the assessments continue being unpaid for one yr or the unpaid amount of money exceeds $1,two hundred, the HOA will have a lien on the house that can be foreclosed on. Underneath Arizona regulation, an HOA’s lien for unpaid assessments attaches routinely, and several property owners you should not realize until its also late just how a great deal trouble can consequence from their failure to spend.
Fines, as opposed to assessments, are the penalties that HOA’s demand for violations of the homeowners’ association’s CC&R’s or other governing documents. Widespread fines stem from a failure to preserve landscaping, leaving trash cans outside the house, and parking in prohibited areas. Unpaid fines do not consequence in an automatic lien and involve that the HOA sue the house owner in courtroom and get hold of a judgment prior to the lien can be recorded. Even immediately after acquiring such a judgment and recording a lien, even so, the HOA can not look for to foreclose on the house for unpaid fines.
Notwithstanding the homeowners’ association’s right to foreclose on a lien for assessments it generally won’t make perception for the HOA to carry on with such an action. While HOA liens have priority over several obligations, such liens will usually be secondary to the major mortgage loan on the house, so if there is not enough equity to spend off the mortgage loan and fulfill the lien, foreclosure might not be warranted. Householders should realize, even so, that failing to spend assessments might consequence in the decline of their house, and that HOA’s might pursue foreclosure even when such an action is not fiscally merited.
The statutes governing the rights and obligations of property owners and HOA’s are intricate, and property owners dealing with selection action by their HOA should contact an experienced Arizona HOA lawyer as shortly as attainable. In several circumstances there are merited defenses, but they ought to be innovative prior to an adverse determination in rendered by a courtroom.