If you live in Arizona and are part of a homeowner association, your home can be taken away even if you make every mortgage payment on time.
Arizona Revised Statute 33.1256 allows an HOA to put a lien on your home and begin foreclosure proceedings once the assessment reaches $1,200 or is delinquent for one year.
Introduced on Monday, Senate Bill 1400 would more than double the foreclosure threshold to $2,500 and give an additional year that homeowners could catch up on payments before the HOA could begin the foreclosure process.
Cave Creek resident John Sellers has been working with groups of homeowners for several months to craft the bill.
"We've had many cases where a $200 assessment turns into $30,000 in liens," he says.
"(SB1400) gives a much more reasonable grace period for the homeowner to take corrective action," Sellers says.
It would also mandate that HOAs offer a "reasonable payment plan" for assessments and reasonable "attorney fees".
Attorney Jonathan Dessaules of Dessaules Law Group represents homeowners in HOA cases. He says SB1400 would be a good first step in helping homeowners who have fallen behind, but says it falls short.
"Who's going to decide what's reasonable?" he asks.
Dessaules says many of his clients try to put money toward their assessment but are rejected if they cannot pay in full, causing them to fall even further behind.
"(The bill needs) a clear, express, and unambiguous statement that HOAs cannot reject a homeowner's payments. Period," he says.
Sellers agrees that the bill isn't perfect, but is a step in the right direction.
"It goes some way towards it, but it isn't exactly what we would have liked," he says.
The bill is still being considered in the Senate, but has not received a hearing date.
What do you think? Let me know by emailing me at Joe@abc15.com or contact me on Facebook or Twitter.
Need my help? Call volunteers with the Assistance League of Phoenix at 855-323-1515.