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Homeowner associations (“HOA”) in Arizona are common. HOAs are tasked with regulating and maintaining the uniformity and appeal of a neighborhood. To cover operational costs, HOAs impose a monthly fee to all residents. When residents are found to be in violation of certain HOA rules and regulations, additional penalties can be imposed. Failure to pay HOA dues or to remedy assessed penalties in a timely manner can lead an HOA to place a lien on the title of the delinquent homeowner’s home. 

This article will help you better understand what these liens are and how you can remove them. 

What are HOA liens in Arizona?

HOA liens in Arizona are recorded instruments of debt that encumber a home. The liens are filed with the County Recorder’s Office after the HOA has demonstrated the evidence of the debt and has submitted the appropriate paperwork. Until the liens are remedied, they are noted on the public record and will show up on a title search of the home. Liens serve as a means for the HOA to collect debt owed

This debt can be in the form of: 

  • Unpaid HOA dues
  • Unpaid fines that have been imposed
  • Unpaid late fees and interest on past due monies
  • Legal and/or collection fees

Arizona HOA Lien Requirements 

In Arizona, HOAs are not mandated to deliver statements of dues owed, but in most cases they do. Typically, property owners are mailed or are emailed their monthly statement and HOA obligations, and can then simply tender the payment for the amount owed. 

In cases where the homeowner does not pay the amount due, the association may inform them of their intent to file a lien in an attempt to collect the past due debt. 

Impact of an HOA Lien

An unresolved HOA lien can make it more difficult to sell your property and can possibly also interfere with your ability to refinance the home due to the HOA having a lien against the property. 

Since the title of the home will be examined during a refinance or a potential sale, liens can place a cloud on the title of the property. This means that the amount of the claim will directly affect the actual value of the property, until the claim is paid in full.

If the HOA lien is substantial enough, a potential buyer may mandate that the seller absorb or resolve the lien amount before or at the time of sale. Similarly, a buyer may also request that the seller reduce the cost of the sale price to reflect the difference in cost to pay off the lien.  

What’s more, banks are unlikely to approve a refinance on a property that has a lien because of the lien’s superiority. Since the HOA lien would be recorded on the title prior to the refinance, it would be paid off before a mortgage note in the event of a foreclosure. Banks prefer to have lien priority — meaning its debt is satisfied before any other debts in the case of a foreclosure; this makes it even more likely the HOA lien would have to be paid off before a refinance would be approved by any lender. 

Foreclosure on HOA Liens

In Arizona, there are certain requirements that prevent HOAs from foreclosing on liens. ARS Statute 33-1807 mandates that the amount of past due debt must exceed $1,200 or be 12 months past due, or greater, before a homeowner’s association can pursue a foreclosure to remedy the balance due. 

How to Remove HOA Liens in Arizona 

There are a few methods that you can consider using to remove HOA liens in Arizona. 

  1. If the debt is valid, fully satisfy the debt. This requires making a direct payment to the HOA for the full amount due, including any past due amounts, interest, legal fees and or collection fees. 
  2. Request a lien release once you have satisfied the debt owed to have the lien updated and released. This measure will also update your title, showing it as free and clear. 
  3. If you believe the lien is invalid you have the right to dispute it to have the lien removed. You will want the benefit of using qualified legal counsel to determine your best course of action in this situation. 

Find An Experienced Arizona Homeowners Association Lawyer

The attorneys at MacQueen & Gottlieb have significant experience with real estate law in Arizona and in helping to resolve disputes with homeowners associations on behalf of our clients. Our attorneys can assist you with any issues and can help you understand your rights as a homeowner. Contact us today at (602) 726-2229 to schedule an initial consultation or make an appointment online.

Call us today at (602) 533-2840 for an appointment.