Overview

California HOAs can foreclose on a home over unpaid assessments, and they can do it without ever setting foot in a courtroom. The Davis-Stirling Act lets an HOA record a lien against a homeowner’s property and then sell that property through a trustee, the same way lenders foreclose under a deed of trust. No judge reviews the decision, and homeowners get no hearing before the sale. HOAs can even proceed with these sales while the underlying debt remains in dispute.

The Davis-Stirling Act limits that power in ways most homeowners never hear about from their own HOAs. Small delinquencies can’t support a foreclosure at all, and unpaid fines can’t support one no matter how large they grow. Bad HOAs blur those limits by lumping fines, late charges, collection costs, and attorneys’ fees into a single balance and then treating the whole number as foreclosable.

Before an HOA can record a lien, and again before it can start a foreclosure, the Davis-Stirling Act requires it to work through a sequence of notices, dispute resolution offers, and recorded board votes. Every one of those steps gives homeowners something to use. HOAs that skip steps, delegate decisions they aren’t allowed to delegate, or paper the file after the fact hand homeowners grounds to attack the lien, the sale, or both.

This Fact Sheet explains when California HOAs can foreclose, the debt limits that put foreclosure out of reach entirely, the procedural requirements HOAs have to satisfy before recording a lien and before starting a sale, the rights homeowners keep even after a sale closes, and how homeowners fight a foreclosure their HOA had no business pursuing.

Key Points

Homeowners facing an HOA collection file need to separate two questions. The first is whether their HOA has the legal power to foreclose at all, which depends entirely on how much they owe and what kind of debt it is. The second is whether the HOA followed the Davis-Stirling Act on the way there, which is where many of these files come apart. The points below cover both, in the order a delinquency unfolds, from the day an assessment goes past due through the 90 day period following a sale.

• California HOAs can foreclose without ever filing a lawsuit. Civil Code 5700 lets an HOA enforce a recorded lien 30 days after recording it, and the statute permits sale by a court, sale by the trustee named in the lien, or sale by a substituted trustee. Civil Code 5710 routes non-judicial sales through the same trustee-sale machinery that governs mortgages and deeds of trust. Bad HOAs prefer the non-judicial route because it costs less, moves faster, and puts no judge in a position to examine whether the debt is legitimate. Judicial foreclosure requires the HOA to file a case and prove it, which takes longer and exposes the HOA to a defense on the merits.
• Assessments go delinquent 15 days after they’re due, and the charges start stacking immediately. Civil Code 5650 makes a regular or special assessment delinquent 15 days after the due date unless the CC&Rs give homeowners longer. From that point, HOAs can add reasonable costs of collection including attorneys’ fees, a late charge of 10% of the delinquent assessment or $10, whichever is greater, and interest of up to 12% per year running from 30 days after the assessment came due. Those charges add up fast against a modest delinquency, and so homeowners who skip even two months of dues can face a balance several times the underlying debt within a year. This is why refusing to pay a disputed assessment is such an expensive mistake, and why the composition of the balance becomes the whole fight later on. [If you’re thinking about withholding payment to make a point, read my Fact Sheet, “Can You Stop Paying Disputed HOA Dues in California”]
• Your HOA can’t foreclose until your unpaid assessments alone reach $1,800. Subject to a time-based exception that I discuss below, Civil Code 5720 prohibits California HOAs from collecting a delinquency through judicial or non-judicial foreclosure when the delinquent regular and special assessments come to less than $1,800. Below that line, HOAs still have options. They can sue in small claims court, and they can record a lien and wait. What they can’t do is take the home.
  • Late charges, interest, collection costs, and attorneys’ fees don’t count toward the $1,800. Civil Code 5720 measures delinquent regular and special assessments and expressly excludes from the calculation accelerated assessments, late charges, fees and costs of collection, attorneys’ fees, and interest. This is the most commonly misrepresented rule in California HOA collections. Homeowners who owe $900 in assessments and $2,400 in fees, costs, and interest owe $3,300 in total and still can’t lose their homes to foreclosure because the assessment component sits below the $1,800 floor. Bad HOAs sometimes try to fool unwary homeowners by lumping those sums together and hoping that the homeowners won’t know the difference.
  • Assessments more than 12 months delinquent open the door regardless of amount. There is, however, an exception to the $1,800 limit discussed above. Once the assessments secured by the lien run more than 12 months delinquent, the $1,800 floor drops away and the HOA can foreclose on a far smaller sum. So, homeowners sitting below the dollar threshold gain nothing by waiting the clock out because time itself is the alternative trigger. [Civil Code 5720 also carves out developers and owners of time-share estates, so the floor protects neither.]
• HOAs can’t rely on non-judicial foreclosures to collect unpaid fines. Civil Code 5725 prohibits HOAs from characterizing or treating a monetary penalty imposed as a disciplinary measure as an assessment that can become a lien enforceable by sale under the non-judicial foreclosure statutes. That closes the fast, cheap route, and it’s the route that bad HOAs want. But two other routes remain open.
  • Charges to repair common area damage are the narrow exception. Civil Code 5725 permits HOAs to lien and foreclose on a monetary charge imposed to reimburse the HOA for repairing common area damage caused by a homeowner, a guest, or a tenant, but only where the governing documents authorize the lien. That exception covers actual repair costs and nothing else. HOAs cannot, therefore, relabel an ordinary rule-violation fine as damage reimbursement to reach a foreclosable balance. Homeowners hit with a reimbursement charge should demand the invoices, the scope of work, and the evidence tying the damage to them to ensure that their HOAs haven’t misused this power.
  • HOAs can also file judicial foreclosures to collect unpaid fines. HOAs might not be able to pursue non-judicial foreclosures to collect on unpaid fines, but they can sue homeowners in court to foreclose on them. This is called judicial foreclosure, and nothing in Civil Code 5725 prevents HOAs from availing themselves of that option. HOAs can also sue on the fine-related debt alone without asking the court to foreclose, win a money judgment, record that judgment, and then pursue a sheriff’s sale on the resulting judgment lien the same as any other post-judgment lien holder. Both routes cost bad HOAs the thing they most want to avoid, which is a courtroom, a judge, and a homeowner with a possible defense on the merits.
• Every payment you make has to go to assessments first. Civil Code 5655 requires HOAs to apply any payment a homeowner makes toward a delinquent balance to the assessments owed first, and only after the assessments are paid in full may the HOA apply anything to collection fees, attorneys’ fees, late charges, or interest. That ordering is a direct defense against foreclosure because the assessment balance is the number that Civil Code 5720 measures. Bad HOAs routinely try to route partial payments into other items, such as their own attorneys’ fees, in an effort to keep the assessment balance artificially high and drive homeowners toward the foreclosure threshold. But such tactics are illegal. [To ensure that homeowners can make last minute payments, HOAs have to publish a mailing address for overnight payments.]
• Your HOA has to send a certified-mail notice 30 days before it records a lien. Civil Code 5660 requires HOAs to notify the homeowner in writing by certified mail at least 30 days before recording a lien. The notice has to include a general description of the HOA’s collection and lien enforcement procedures and the method used to calculate the amount owed. The HOA’s notice also has to include an itemized statement separating delinquent assessments from collection fees, attorneys’ fees, late charges, and interest. It also has to carry a warning in 14-point boldface type or in capital letters stating that the property may be sold without court action, and it has to tell homeowners about their right to inspect HOA records, request a payment plan meeting, demand internal dispute resolution, and demand alternative dispute resolution before the HOA initiates foreclosure. Notices missing any of those elements can invalidate the legality of the lien or a subsequent sale.
  • You have a right to demand a meeting with your HOA board about a payment plan. Civil Code 5665 lets homeowners submit a written request to meet with the HOA board to discuss a payment plan for the noticed debt. Homeowners who mail that request within 15 days of the postmark on the pre-lien notice obligate the HOA board to meet with them in executive session within 45 days of the request’s postmark. Late charges stop accruing while a homeowner complies with the terms of an agreed plan. Homeowners who avail themselves of this meeting must still remember two important things: (a) a payment plan doesn’t stop the HOA from recording a lien to secure the debt; and (b) defaulting on the plan lets the HOA resume collection from exactly where it stood before the plan started.
  • The pre-lien notice also has to tell you that you owe nothing if the assessment turns out to have been paid on time. Civil Code 5660 requires HOAs to state in the notice that the homeowner isn’t liable for the charges, interest, and costs of collection if it’s determined that the assessment reached the HOA on time. Homeowners who can prove timely payment defeat not only the assessment but every fee, late charge, and interest dollar the HOA piled on top of it. Bank records, cleared check images, and certified mail receipts are critical pieces of evidence homeowners can submit to prove that they made timely payments.
• Your HOA has to offer you internal dispute resolution before it records a lien. Civil Code 5670 requires HOAs to offer the homeowner internal dispute resolution (IDR) through the HOA’s internal meet-and-confer program before recording a lien for delinquent assessments, and to participate in that process if the homeowner requests it. That’s an HOA’s obligation, so homeowners don’t forfeit anything by failing to ask. [For a full explanation of how internal dispute resolution works and its effect on fines, lawsuits, and enforcement, read my Fact Sheet, “What Is IDR in a California HOA? Does It Stop Fines, Lawsuits, or Enforcement?”]
• Only your HOA board can decide to record a lien, and it has to make that decision in an open meeting. Civil Code 5673 requires the HOA board itself to decide whether to record a lien for delinquent assessments and prohibits delegating that decision to any agent of the HOA (like the manager). The HOA board has to approve the decision by majority vote of the directors at an open meeting, and it has to record that vote in the minutes of the meeting. The minutes are the proof, and homeowners who request them and find no recorded vote can void the entire lien.
• The recorded lien has to contain specific information, and it takes priority the moment it hits the county recorder. Civil Code 5675 requires the notice of delinquent assessment to state the amount owed, a legal description of the property, and the name of the record owner, and it requires the HOA to record the itemized statement of charges together with the notice. HOAs who avail themselves of the non-judicial foreclosure process also have to name the trustee authorized to conduct the sale in that notice. The HOA has to mail a copy of the recorded notice by certified mail to every person its records show as an owner within 10 days of recording. [For more on how these liens function in a sale and what has to be paid to clear title, read my Fact Sheet, “HOA Liens and Short Sales: What Must be Paid to Clear Title.”]
  • Your HOA has 21 days to release the lien once you pay. Civil Code 5685 requires HOAs to record a lien release or notice of rescission within 21 days of payment of the sums specified in the notice of delinquent assessment, and to give the homeowner a copy. The same obligation applies to liens an HOA recorded in error. Homeowners who pay and then find the lien still sitting on title past that deadline can go after the HOA for clouding title, especially if it interferes with any refinance or sale.
• When your HOA skips a step, it has to start the notice process over and pay for the restart itself. Civil Code 5690 requires HOAs that fail to comply with the collection procedures to start the entire process from the beginning and to pay for that restart on its own. That’s one of the things that gives the process described above some teeth in the homeowner’s favor. So, for example, if an HOA shortens the 30-day pre-lien window, sends the notice by regular mail, omits the itemized statement, or records without a board vote or supporting minutes, that HOA will have to run the entire sequence again on their own dime, which resets the clock, delays the collection file by months, and gives homeowners time they didn’t have before.
• Before your HOA can start a non-judicial foreclosure, it has to clear a second set of requirements. Civil Code 5705 imposes obligations that are separate from and additional to everything required at the lien stage, and clearing the lien hurdles doesn’t clear these. HOAs have to offer homeowners either IDR (again) or another form of alternative dispute resolution (such as mediation) before initiating foreclosure. As with the lien, the decision to foreclose has to come from the HOA board by majority vote in executive session (it can’t be delegated to the manager), and the HOA board has to record that vote in the minutes of its next open meeting identifying the property by parcel number rather than by the homeowner’s name. And, that vote has to take place at least 30 days before any public sale. Finally, to help ensure that homeowners get the required notice, Civil Code 5705 requires HOAs to serve homeowners who live at the properties in question personally. First-class mail is permitted only for homeowners who don’t live at the property.
• You get 90 days to buy your home back after a non-judicial foreclosure sale. Civil Code 5715 subjects every non-judicial foreclosure by a California HOA to something called a right of redemption, which that runs for 90 days after the sale. This is different from homeowners who lose their homes when their lenders foreclosure, because in those cases, there is no right of redemption. Civil Code 5715 also requires the notice of sale to state that the property is being sold subject to that right. This is actually more helpful than it might seem because it serves to suppress what third-party bidders might be willing to pay at a sale, which often leaves the HOA itself as the buyer. [The reason that this is helpful is because not only can homeowners in that 90-day window refinance, sell, or borrow against the property to redeem it, but speculators are often not willing to bid on properties when they know that there’s a redemption right attached to the sale.]
• Your HOA can’t sell its collection file to a third party and let that party foreclose. Subject to a single exception, Civil Code 5735 prohibits HOAs from voluntarily assigning or pledging the right to collect assessments or to enforce or foreclose a lien to any third party. HOAs can, however, assign the unpaid obligations of a former member to a third party for collection purposes because foreclosure isn’t on the table. [The exception I referenced above applies to a pledge to a chartered or licensed financial institution as security for a loan that the HOA obtains.]
• Homeowners facing a foreclosure threat should demand the numbers, pull the minutes, and put every request in writing. Homeowner should start with a written demand for a line-item breakdown separating delinquent regular and special assessments from late charges, interest, collection costs, attorneys’ fees, and fines. Homeowners should also request the minutes of the open meeting where the HOA board voted to record the lien and the minutes reporting its executive session vote to foreclose. At that point, homeowners can compare the pre-lien notice requirements against Civil Code 5660 line by line, checking for certified mail, the full 30 days, the itemized statement, the boldface sale warning, and each right that the statute requires the HOA to disclose. At that point, owners should mail the payment plan request within 15 days of the postmark on that notice, and send separate written demands for IDR before the lien and alternative dispute resolution before the foreclosure.
• If your California HOA is threatening foreclosure, call the HOA attorneys at MBK Chapman immediately. The HOA attorneys at MBK Chapman are among the most respected homeowner-side HOA lawyers in California, and we’ve spent decades dismantling collection files that HOAs and their lawyers assumed nobody would examine. This is not a time to delay or figure things out for yourself. If you’re facing the imminent loss of your home, call us at MBK Chapman, and let us try to help you.

Foreclosure is the most severe remedy the Davis-Stirling Act gives a California HOA, and the Legislature surrounded it with conditions precisely because the consequence is permanent and draconian. Most homeowners never test those conditions, which is exactly what bad HOAs and their collection lawyers count on. The debt has to be the right size and the right kind, and the HOA has to have earned its way through every notice, offer, and recorded vote the statutes demand. Homeowners who force their HOAs to prove each of those things frequently discover the foreclosure was never available in the first place (which is why it’s so critical to call the HOA attorneys at MBK Chapman if you’re ever facing a foreclosure).

FAQs

About Michael Kushner

Michael Kushner is a California attorney with over 30 years of experience representing homeowners in disputes with their HOAs. He is widely regarded as California’s leading homeowner-side HOA attorney, and has built one of the state’s most prominent law practices dedicated to holding HOAs accountable under the Davis-Stirling Act and California law.

In addition to his law firm’s work, Michael is a recognized lecturer, author, and the host of the hit HOA HELL podcast, where he provides homeowners living in HOA-governed communities with clear, practical strategies for dealing with bad HOAs. He’s also the author of the best-selling book, HOA HELL | California Homeowners’ Definitive Guide to Beating Bad HOAs, which has become a go-to resource for both homeowners seeking real-world solutions to their HOA disputes, as well as those good HOA board members who are interested in doing a good job.

About MBK Chapman Fact Sheets

Homeowners searching for answers online will often come across articles that appear authoritative, but are actually written as search-engine marketing content rather than by an experienced HOA lawyer. These pieces tend to prioritize keyword density over clarity, accuracy, or legal context, which often leaves homeowners more confused than informed.

At MBK Chapman, our Fact Sheets are part of our HOA Law Library and are written by Michael Kushner, an HOA lawyer with decades of hands-on experience representing California homeowners. In fact, Michael Kushner is the HOA lawyer who pioneered the systems and strategies used by some of California’s most successful homeowner-side HOA law firms.

Each Fact Sheet is deliberately concise, statute-based, and designed as a quick-reference guide to help homeowners understand key HOA laws and enforcement rules at a glance.

AND DON’T FORGET TO TUNE INTO MY PODCAST, HOA HELL

YOU CAN ALSO ORDER MY GROUNDBREAKING BOOK

HOA HELL | California Homeowners’ Definitive Guide to Beating Bad HOAs

Amazon  |  Barnes & Noble