Washington HOA and COA Foreclosures
If you default on HOA or COA dues and assessments in Washington, the homeowners association can foreclosure on your condo, townhome, or house.
If you live in a condominium, single-family house, or townhome that is part of a common interest community in Washington, you are most likely responsible for paying dues and assessments to a condominium association (COA) or homeowners’ association (HOA). If you don’t pay, the COA or HOA can usually get a lien on your property that could lead to a foreclosure.
Read on to learn more about COA and HOA foreclosures in Washington.
Washington COA Laws
The Washington Condominium Act, which can be found in Chapter 64.34 of the Revised Code of Washington, applies to all condominiums created after July 1, 1990. It also applies to most condos created before that date in regard to events and circumstances that occur after that date, with a few exceptions. (The state’s older Horizontal Property Regimes Act found in Chapter 64.32 governs some condos created before July 1, 1990. This article focuses on the provisions of the newer Condominium Act.)
Washington HOA Laws
Chapter 64.38 of the Revised Code of Washington governs the formation and legal administration of HOAs in Washington, but there is no statute that specifically addresses liens for assessments.
HOAs are also controlled by their governing documents, which include the Declaration of Covenants, Conditions, and Restrictions (CC&Rs) and bylaws. The specific rules regarding assessments liens can commonly be found in these governing documents. (You should have received copies of the CC&Rs and bylaws when you purchased your property. Find out more about what's in your HOA CC&Rs and other relevant documents in Nolo’s article Before Buying: How to Read the CC&Rs or Homeowners' Association (HOA) Documents.)
How COA and HOA Liens Work
A COA or HOA typically has the power to place a lien on your property if you get behind in monthly dues and/or any special assessments (collectively referred to as assessments). Generally, once a homeowner defaults on assessments, a lien will automatically attach to that homeowner's property.
In Washington, a COA is entitled to a lien on a condo for any unpaid assessments from the time the assessment is due (Wash. Rev. Code § 64.34.364(1)). The recording of the COA’s governing documents (that is, the CC&Rs and bylaws) in the county records constitutes record notice and perfection of the lien. The COA doesn't have to record the lien in the county records, although it can do so if it wants to. (Wash. Rev. Code § 64.34.364(7)).
If you are part of an HOA, check the association’s CC&Rs and bylaws to learn about the association’s right to place a lien on your home if you don’t pay the assessments.
Charges the COA or HOA May Include in the Lien
State law and the COA or HOA’s governing documents will usually set out the type of charges that the association may impose in addition to the past-due assessments. In Washington, a COA also has the power to impose:
- late charges
- fines for violations of the rules
- reasonable attorney’s fees, and
- interest (Wash. Rev. Code §§ 64.34.304(1)(k), 64.34.360(2), 64.34.364(13), (14)).
To find out which charges an HOA in Washington may include in its lien, check the association's governing documents.
Lien priority determines what happens to other liens, mortgages, and lines of credit if your COA or HOA 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 Washington, COA liens are prior to all other liens, except for:
- liens and encumbrances recorded before the COA recorded the condo declaration
- liens for real property taxes (and other governmental assessments or charges), and
- a mortgage on the condo that was recorded before the delinquency date of the assessment (Wash. Rev. Code § 64.34.364(2)).
To find out the priority of an HOA lien in Washington, check the association’s governing documents. (Often, an HOA’s CC&Rs will state that an HOA lien is subordinate to a lender’s mortgage).
COA Super Liens
In some states, a lien for delinquent assessments has priority over a lender’s mortgage. This is called a super lien. (Learn more in Nolo’s article Homeowners’ Association Super Liens.)
In Washington, a COA is entitled to a super lien over mortgages recorded before the date that the assessment became delinquent in an amount equal to six months worth of delinquent common expense assessments (Wash. Rev. Code § 64.34.364(3)). (This can be reduced by up to three months under certain circumstances and, if the COA elects to foreclose nonjudicially, it is not entitled to a super lien.) (Wash. Rev. Code § 64.34.364(4),(5)).
Requesting a Statement of Unpaid Assessments from a COA
If you make a written request to the COA, the association must provide you with a statement of the amount due within 15 days after receiving the request (Wash. Rev. Code § 64.34.364(15)).
COA and HOA Foreclosures in Washington
If you default on the assessments, the COA or HOA 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 Washington, a COA lien may be foreclosed:
- judicially (which means the COA will file a lawsuit) or
- nonjudicially (which means the foreclosure takes place without court supervision), if permitted by the COA’s governing documents (Wash. Rev. Code § 64.34.364(9)). (Learn more about judicial v. nonjudicial foreclosures and general foreclosure laws and procedures in Washington.)
To find out about an HOA’s right to foreclose if you become delinquent in paying the assessments, read the association’s governing documents.
Statute of Limitations for COA Liens and Assessments
Unless the COA starts the foreclosure or sues the condo owner personally for payment within three years after the full amount of the assessments becomes due, a lien for unpaid assessments, as well as the condo owner’s personal liability for the assessments, will be extinguished (eliminated) (Wash. Rev. Code § 64.34.364(8)). This is called the statute of limitations.
Redemption After Judicial Foreclosure
In Washington, certain parties (including the foreclosed owner and the mortgage lender if its lien is foreclosed by a COA super lien) may "redeem" or buy the property after a judicial foreclosure (Wash. Rev. Code Ann. § 6.23.010). To redeem, the redeeming party must reimburse the purchaser (the person or entity who bought it at the foreclosure sale) for the amount of the bid plus all other allowable charges after the sale, such as:
- amounts the purchaser paid on prior liens (plus interest), and
- amounts the purchaser paid for assessments or taxes, plus interest on that amount (Wash. Rev. Code Ann. § 6.23.020(2)). (Learn more about the redemption period after a Washington foreclosure.)
If you are facing a COA or HOA foreclosure, you should consult with an attorney licensed in Washington 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.)