What Is the Georgia HOA Statute for Foreclosure?

Georgia state statutes include the Georgia Property Owners’ Association Act, which legislates homeowners’ associations, or HOAs, in the state with certain legal powers and obligations. An HOA has the power to assess and collect monetary payments from the property owners. The law allows an HOA to foreclose against delinquent owners under certain conditions.

The law, adopted in 1994, greatly expanded the powers of HOAs in Georgia. Its provisions are applicable to any property development with an HOA that, in its declaration document, states that it will be governed by the provisions of the law. For a project built since 1994, the declaration is easily done, at the start of the project, by the developer. For older projects, the HOA declaration must be a legal amendment to the existing declaration.

The law grants HOAs the power to create and enforce automatic liens against individual properties. Any legally assessed monetary amount becomes a lien against the owner’s individual property and in favor of the HOA. A lien can be for monthly common charges or fees, imposed fines, and improvement or repair assessments. The lien created is for all monetary amounts due, including allowable late charges and interest. The HOA need not file or record a specific lien document to enforce the lien.

With a lien against the owner’s real property, the HOA has the power to use foreclosure to collect delinquent payments, as stipulated in the law. Foreclosure action is limited to liens of at least $2,000. The HOA must send a formal notice to the property owner of its intent to enforce payment of the lien by foreclosure. This notice must be sent to the owner at least 30 days in advance by certified mail with return receipt. If the delinquency is not resolved within that time, the HOA can institute a judicial foreclosure procedure against the owner.

The required notice that is sent before foreclosure must contain a detailed itemization of all charges due and must be sent to all known addresses of the property owner. Liens cannot be enforced by the HOA after four years from the date when the liens were first due and payable. A HOA can foreclose without having to pay off any existing mortgage or tax liens, but any new owner of the property will be obligated to these existing liens. Any existing liens that an HOA has on a property must be disclosed to a potential buyer within five days of inquiry of the same; otherwise, the liens are legally unenforceable against the asking party.