Pennsylvania HOA and COA Foreclosures
If you default on HOA or COA dues and assessments in Pennsylvania, the homeowners association can foreclosure on your condo, townhome, or house.
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If you live in a private community setting (whether it is a condominium, townhouse, or single-family home) in Pennsylvania, usually you must pay dues and assessments to a homeowners’ association (HOA) or a condominium association (COA). If you fall behind in payments, in most cases the HOA or COA can get a lien on your home that could lead to a foreclosure.
Read on to learn about the particular requirements for HOA and COA foreclosures in Pennsylvania.
Pennsylvania HOA and COA Lien Laws
In Pennsylvania, the Uniform Planned Community Act (68 Pa. Cons. Stat. §§ 5101 through 5414) governs HOAs, while the Uniform Condominium Act (68 Pa. Cons. Stat. §§ 3101 through 3414) applies to COAs. The two sets of laws are very similar.
In addition, you can find the association's operation policies (including those regarding assessments liens) in the HOA or COA's governing documents. The governing documents include the Declaration of Covenants, Conditions, and Restrictions (CC&Rs) and the bylaws. (Find out more about what's in your CC&Rs and other relevant documents in Nolo’s article Before Buying: How to Read the CC&Rs or Homeowners' Association (HOA) Documents.)
How HOA and COA Liens Work
Most HOAs and COAs have the power to place a lien on your home if you get behind in monthly dues and/or any special assessments (collectively referred to as assessments). Generally, once a homeowner defaults on the assessments, a lien will automatically attach to that homeowner's property.
In Pennsylvania, an HOA or COA has a lien for unpaid assessments from the time the assessment or fine becomes due. If an assessment is payable in installments, the entire outstanding balance of the assessment becomes effective as a lien from the due date of the delinquent installment (68 Pa. Cons. Stat. § 5315(a), § 3315(a)).
The recording of the HOA or COA’s declaration counts as notice of the lien (68 Pa. Cons. Stat. § 5315(d), § 3315(c)). This means the HOA or COA doesn't have to record a claim of lien in the county records in order for it to be effective. (In some states, the association must record the lien.)
Charges the HOA or COA May Include in the Lien
State law and the HOA or COA’s governing documents will often set out the type of charges that it may include in the lien. In Pennsylvania, an HOA or COA is permitted to include the following in its lien (unless the governing documents provide otherwise):
- past-due assessments
- late charges
- collection costs and expenses
- fines for violations of the declaration, bylaws, and rules and regulations of the association
- interest, although it cannot be higher than 15% per year (68 Pa. Cons. Stat. § 5314(b), § 3314(b)), and
- other charges, such as for the preparation and recording of amendments to the declaration or statements of unpaid assessments (68 Pa. Cons. Stat. § 5315(a), § 3315(a)).
Requesting a Statement of Unpaid Assessments from an HOA or COA
If you make a written request to the HOA or COA, the association must provide you with a statement of the amount of unpaid assessments within ten business days after receiving the request (68 Pa. Cons. Stat. § 5315(h), § 3315(g)).
Lien priority determines what happens to other liens, mortgages, and lines of credit if your HOA or COA lien is foreclosed. (To learn more about lien priority and its importance in HOA foreclosures, see What happens to my mortgages if the HOA forecloses on its lien?)
In Pennsylvania, an HOA lien or COA lien has priority over all other liens and encumbrances, except for:
- liens recorded before the association records it's declaration
- first mortgages and deeds of trust recorded before the due date of the assessment
- judgments for debts secured by first mortgages and deeds of trust, and
- real estate tax liens and other governmental assessments (68 Pa. Cons. Stat. § 5315(b), § 3315(b)).
Under certain circumstances, an HOA or COA lien has priority over a lender’s first mortgage or deed of trust. This is called a super lien. In Pennsylvania, six months worth of delinquent assessments have super lien status (68 Pa. Cons. Stat. § 5315(b), § 3315(b)). (Learn more in Nolo’s article Homeowners’ Association Super Liens.)
HOA and COA Foreclosures in Pennsylvania
If you default on the assessments, the HOA or COA can foreclose. A common misconception is that the association cannot foreclose if you are current with your mortgage payments. However, the association’s right to foreclose has nothing to do with whether you are current on your mortgage payments. (Learn more about HOA liens and foreclosure.)
In Pennsylvania, an HOA or COA may foreclose its lien in the same way that a mortgage on real property is foreclosed (68 Pa. Cons. Stat. § 5315(a), § 3315(a)). This means the association will file a lawsuit to begin the foreclosure. (Learn more about general foreclosure laws and procedures in Pennsylvania.)
Statute of Limitations for HOA and COA Liens
An HOA or COA must initiate the foreclosure within three years after the assessments become payable otherwise the lien is extinguished (eliminated) (68 Pa. Cons. Stat. § 5315(e), § 3315(d)). This is called the statute of limitations.
What to Do if You Are Facing Foreclosure by an HOA or COA in Pennsylvania
If you are facing an HOA or COA foreclosure, you should consult with an attorney licensed in Pennsylvania to discuss all legal options available in your particular circumstances. (See our HOA Foreclosure topic page for articles on HOAs, possible options to catch up if you are delinquent in payments, how bankruptcy can help discharge dues, HOA super liens, and more.)