Foreclosure in Sacramento>Question Details

Vwsales, Home Owner in Roseville, CA

Can a HOA foreclose on a home if the first lein is current w/ $200K negative equity on the first loan? Is the HOA superior to the first?

Asked by Vwsales, Roseville, CA Sun Apr 29, 2012

Help the community by answering this question:


If you don't pay HOA assessments, the homeowner's association can initiate foreclosure proceedings. An HOA foreclosure is similar to a foreclosure of your home by a mortgage lender. However, there are a few differences.

I hope this helps and you can visit the site directly for more info:
2 votes Thank Flag Link Tue Aug 18, 2015
They Can They Will & they should regardless of equity. An HOA is not in business to make a profit they are in the business of making sure that everyone pays their fair share. Even with negative equity the HOA can sell your home to reclaim the past due assessments or even rent your home if the home reverts back to the HOA until the first forecloses. Websites like or specialize in HOA aftermarket properties. As for the superiority of the HOA lien. The HOA foreclosure wipes out everything but the holder of the first deed of trust and the taxes. So you should contact your HOA or their collection agency immediately if they have threatened foreclosure and make payment arrangements. Many people are struggling with their mortgages but your HOA is your direct communities and neighbors you should keep them current. In most states you are responsible for the HOA dues for the term of your ownership anyway. You can be held liable for those dues even after the bank forecloses.
Web Reference:
1 vote Thank Flag Link Wed May 9, 2012
Elizabeth is right. HOA's may have the right to foreclose, but you
are accurate in thinking the mortgage may have a superior claim.
Any junior lien holder, whether they are #2, #3 or 6th in line
can exercize any foreclosure rights they have. Typically they do
not because they will get $0 after spending the time and money
to exercize their "right". If they do nothing they will be wiped out
by the foreclosure action of the superior lien holder, but at that
time they may have the right to file a personal claim against
the debtor and have not spent money in a foreclosure action.
Delinquent HOA dues can stop a short sale unless they can
be satisfied.....some will negotiate a lesser settlement and
some will not. It may be best to try to stay in communication
with the association as the foreclosure actions by HOA's
frequently are because the association is attempting to get
a nusance property vacant. Making friends will frequently
get you the best results.
And of course you should always consult an attorney for the
necessary legal advise on situations like this.
Good luck to you
Patrick O'Hare
DRE 00856701
Century 21 Select Real Estate
1 vote Thank Flag Link Sun Apr 29, 2012
In CA, if you stop paying your HOA dues, the HOA can record a lien. Yes, they can foreclose and it has nothing to do with whether you are current on your mortgage. Since a foreclosure by a junior HOA lien holder does not affect the senior lien holders security interests, the HOA would get the property with all senior liens still in place. If you have only negative equity, taking the property back does not make a whole lot of sense for the HOA as they can't sell the property without satisfying the senior lien holders' interests first which means there is nothing left for the HOA to satisfy their interest. Thus, foreclosing on a property with negative equity would not be in the HOA's best interest. No, the HOA lien is not superior to the first in CA if it was recorded later as CA is not (yet) a super lien state.
1 vote Thank Flag Link Sun Apr 29, 2012
If the HOA purchases the home at auction, can the HOA force a moveout (even if the 1st lein is kept in good standing)?
Flag Sun Apr 29, 2012
Ute Ferdig -…, Real Estate Pro in New Castle, DE
This is from the NOLO website and pretty helpful. I agree, you need to consult with an attorney. I hope this helps and you can visit the site directly for more info:

HOA liens are usually junior to a first mortgage. This is because the HOA lien is either:
•recorded after the first mortgage, or
•the CC&Rs or state law makes the HOA lien junior to any first mortgage (even if the HOA lien is actually senior).

This means that the first-mortgage lien will stay on the property following the HOA foreclosure and the purchaser at the foreclosure sale will take title subject to the lien of the first mortgage holder. (Learn more in Nolo's article HOA Liens & Foreclosures: An Overview.)

HOA Super Liens Are Senior to First Mortgages

Some states give certain HOA liens super priority. In super-lien states, a certain number of months worth of past-due HOA assessments are given super-lien status and are senior to even a first mortgage. (Any amounts owed beyond the super lien are then junior to the mortgage.) If the HOA forecloses a super lien, it can potentially, in some cases, eliminate the first mortgage and any other junior mortgages on the property. (Learn more in Nolo’s article Homeowners Association Super Liens.)

(Keep in mind that just because a mortgage lien is eliminated, this doesn’t mean you’re off the hook for the debt. Learn more in
0 votes Thank Flag Link Sat Feb 14, 2015
I own my home outright can a hoa forclose on my home.
0 votes Thank Flag Link Sat Feb 14, 2015
If you are in arrears for HOA dues then contact me via email. I can possibly bring them current. Depends on some qualifying criteria which I will be glad to personally go over with you. I do not care if there is any equity or not.
Don La Barbera
0 votes Thank Flag Link Fri Dec 14, 2012
Hi....I am in Bethesda MD. My HOA did have an auction sale and "bought" my property. They are not settling on it, so I still have the deed. My mortgage was current, and when this was in the works my boyfriend (roommate) said, "Well, let's just stop paying the mortgage". I tried to negotiate with them but had no luck. In late June they won the auction as the only bidder. I am still living here in Sept., and no one has done anything. I guess final sale ratification will take place soon. Now, they are not going to settle, and I still have the deed. The mortgage co. keeps trying to get me to do an loan modification. I want very badly to stay here, and I can make it work now. I just don't see how the HOA can own it if they don't go to settlement. Anyway, do you have any thoughts? email. 240-425-3657 phone
Flag Wed Sep 25, 2013
As the others say, yes.

Rationally and logically, Kevin, Gina, Ute, and a few of the others are correct that it might not be in the HOA's best intererest. However, also read Justanotherinvestor's comment.

I personally have seen condo associations foreclose on properties out of sheer spite. Or maybe not totally for that reason, but they wanted to teach the condo owner a lesson and wanted to send a message out to other condo owners. HOAs have developed a reputation--not totally undeserved--for sometimes being petty, vindictive, and stubborn. Some HOAs are well-run; others aren't. Some have reasonable, rational folks in positions of power; others don't.

So your situation is more than a theoretical: "Well, yes, technically they could but in the real world it'll never happen."

Definitely check with a lawyer on how to protect yourself.

Hope that helps.
0 votes Thank Flag Link Thu May 10, 2012
Don Tepper, Real Estate Pro in Burke, VA
As indicated previously, the short answer is 'Yes', but with negative equity, I would be surprised if they actually did...
0 votes Thank Flag Link Thu May 10, 2012
Ute: Thanks for chiming in on this subject. I’ve had lots of people give various opinions on this matter, and I always thought the law in this state was exactly what you have indicated. If I ever get another HOA screwing up a short-sale again, I’ll give them your information.
Web Reference:
0 votes Thank Flag Link Thu May 10, 2012
To Mack McCoy. No, in CA, HOAs do not have the same statutory priority as HOAs have in many other states. It's not that HOAs have not tried to get that. That's why I said in my original post that CA is not "yet" a super lien state.
0 votes Thank Flag Link Thu May 10, 2012
Ute Ferdig -…, Real Estate Pro in New Castle, DE
I think the California agents should check this out, because I think that condos have a statutory priority lien before everyone, except maybe the IRS, for six months' delinquent dues.
0 votes Thank Flag Link Thu May 10, 2012
Yes, a HOA may have the right to foreclose. As a junior lien holder that would not be in their best interest in this market, where so many homes do not have equity. If you are facing a foreclosure it is best to consult with a real estate professional as well as a real estate attorney. You will receive advice specific to your situation. Then, as an informed homeowner, you can strategize about the best pre-foreclosure option for your specific situation. I offer a complementary pre-forclosure consultation, as do other Realtors. With that consultation would be a list of real estate attorneys. It is best to explore your options before a foreclosure date is set. The earlier you take action the more options you could have to choose from.
0 votes Thank Flag Link Sun Apr 29, 2012
Way too late....The HOA purchased the home at auction. I don't understand the point. The house is upside down and the 1st is in good standing. I guess there is 90 days to figure out what to do.
Flag Mon Apr 30, 2012
You have already excellent answers from my esteemed colleagues. I just would like to add that you might want to pose this question to a real estate attorney at There, you are able to pose a question to an attorney for free.

Hope that helps,
James Tan
Bethany Real Estate and investments
0 votes Thank Flag Link Sun Apr 29, 2012
You've got a consensus on your answer that I concur with as well.

Speak with an attorney if you are concerned with the legal implications. I can refer you to a few who are well versed in this area of the law if you're interested, ofr a nominal fee of $200. But your question really sounds like a piece of a much larger puzzle. So speaking with an attorney may help you sort out ALL issues related to your home.

Good luck.
0 votes Thank Flag Link Sun Apr 29, 2012
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