05 May Don’t Just Ignore Your HOA Assessments in Texas… by Clint Hays

Homeowners’ Associations (HOAs) play a crucial role in maintaining the value and appearance of residential communities. However, they also wield significant enforcement power, including the ability to file a lien against a delinquent homeowner’s property for unpaid assessments, fines and attorney’s fees. If the debt remains unpaid,  these liens can ultimately lead to foreclosure. Understanding the legal framework governing HOA liens is crucial for both homeowners and HOA boards to ensure compliance with Texas law and to avoid costly legal disputes.

Texas Law

Texas law does not automatically grant associations the power to create assessment liens; this authority must be specifically stated in the association’s governing documents. In addition to authorizing the use of liens to collect unpaid debts, the governing documents should also specify what types of debts a lien may secure, including overdue assessments, fines, interest and attorney’s fees incident to the lien filing. Once the authority has been established, Texas Property Code Chapter 209, also known as the Texas Residential Property Owners Protection Act, governs the processes and procedures related to the filing of HOA liens for most single-family residential subdivisions, while the Texas Uniform Condominium Act, found in Texas Property Code Chapter 82, applies to condominiums. These statutes outline the processes and restrictions homeowner associations must follow when asserting lien rights, including ensuring that homeowners are provided with proper notice and an opportunity to address the debts before a lien is filed against their property.

The primary reason an HOA may file a lien against a property is for unpaid assessments. This includes regular assessments, special assessments levied for major community projects or repairs, and any late fees, interest and collection costs related to the delinquent assessments. Texas law explicitly prohibits an HOA from filing liens solely based on unpaid fines for rule violations (parking violations, landscape violations, etc.) or for attorney’s fees related to enforcing the rule violations.

Stay Informed

For homeowners, the best approach is to stay informed about HOA obligations, address any disputes promptly, and communicate proactively with the association if financial hardships arise. Many homeowners’ associations are willing to work with homeowners to resolve delinquencies without resorting to the filing of a lien, which could eventually lead to foreclosure.  Conversely, an HOA which ensures strict compliance with Texas law, provides clear communication to property owners, and only uses foreclosure as a last resort, can help maintain community trust and avoid possible litigation.

In summary, the HOA lien power in Texas is a significant legal tool, but it comes with substantial responsibilities. Both homeowners and HOA boards must understand the rights and obligations imposed by state law to navigate these issues effectively. Seeking legal guidance from an attorney that is knowledgeable in the area of HOA law when disputes arise can help prevent mistakes and ensure the fair treatment of all parties involved.

Written by Clint J. Hays, Senior Attorney