Does an HOA lien supersede the mortgage lien?

Asked by Confused&tired, 78247 Mon Nov 30, 2009

My hoa sent me a letter saying that they forclosed on my home in texas and bought it at auction. I would like to know if the hoa foreclosure supersedes the mortgage lien and if so who do I pay the mortgage payments to or do I have a mortgage to pay?

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Jason Campbe…, Agent, San Antonio, TX
Fri Dec 17, 2010
To answer your question... the HOA Lien does not SUPERSEDE the Mortgage... The HOA may be in a second lien position, but they do still have the right to foreclose.

But, unlike a mortgage company that can be extremely difficult to derail during a foreclosure process, working with your homeowners association can be far easier.

It is not in the homeowners association's best interest to own your home. The lien created by the assessment is an unsecured lien. While it does give them the right to foreclosure of the home, a mortgage is NOT paid off or wiped out by the foreclosure. Anyone assuming the title of the home through a foreclosure action of this type will either have to pay off the mortgage or arrange to assume the loan. So it is not that it supersedes the mortgage, it's that it now makes them the new owner of the property with a mortgage lien on it... and if that mortgage is not paid, the lender may come in and foreclose.

There is a redemption period.. go here to see all of that info:

If you are within 180 days, you may be able to redeem the property back.
1 vote
I have a question. The Hoa sold the deed to my for 6875 and the guy became the owner. HOA did not send the paperwork to my mortgage company letting them know that he owned the property now so they put the foreclosure on my credit and refuse to take it off. Is this legal
Flag Sat Jul 15, 2017
Mack McCoy, Agent, Seattle, WA
Mon Nov 30, 2009
Yeah, something's missing in the story.

Your lender wouldn't allow the HOA to take position ahead of them, and I'm sure that the great state of Texas has laws governing the notice of foreclosure.

Scam, call attorney, call HOA /property manager to verify facts, call call call call.

Your mortgage payments continue to go to the same place as always. NEVER - as in, not even one time - make a payment elsewhere UNLESS DIRECTED TO DO SO by your CURRENT LENDER. Capisco?
1 vote
Russ Ravary, Agent, Commerce Township, MI
Sun Mar 3, 2013
You still owe the mortgage company because the mortgage company has first priority. Consult with a local real estate attorney to determine your course of action
0 votes
Christinetur…, Home Buyer, San Antonio, TX
Mon Sep 10, 2012
Good Lord the HOA's are lethal,
But I would urgently call the people who hold the note on your property.
Dont just think its the bank you got your mortgage from originally.

Then go quickly to the County Records and look up your property and see if any liens are filed against it.

If your income is low go to legal aid and ask them to assist you in deciding if there is anything you have time to file to stop their actions.
Good luck
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Austin Fresh, Home Buyer, Texas
Fri Feb 3, 2012
Did you say the property was already foreclosed and purchased at auction? If so, what your asking? You no longer have a mortage. The home is gone. So who are you trying to pay, the Lienholder? You're in default of the original contract which basically renders it void. As such, any liens would probably need to be settled directly with the Lienholders.

Don't ask Realtors what they think, especially on an Internet forum. Realtors, Brokers and "Loan Officers" are not v Legal Counsel by any stretch. You need to hire a Real Estate Attorney to help you. Immediatley.
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Kevin Vitali, Agent, Tewksbury, MA
Mon Oct 31, 2011
Here in Massachusetts a condo fees are considered super liens and can supersede a first mortgage. Also a condo association can foreclose in Massachusetts.

Every state is different. I would consult a Texas real estate attorney to see what your rights and obligations are as far as the condo is concerned.
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T.E. & Naima…, Agent, Dallas, TX
Sun Oct 23, 2011
Unfortunately, the answer is not an absolute. In almost all cases the HOA liens are subordinate to mortgage liens. Banks just don't want to have the possibility that the HOA could foreclose and take the property out from under them.

Remember, though, that the HOA was created by covenant long before the buyer considered purchasing the property. Those promises (covenants) do supersede the placing on the mortgage on the property; however, before you get all excited, almost every CCR document (the covenants that created the HOA's power) grant a subordination clause to purchasers who need to mortgage their property in order to get purchase money.

Usually, several pages back in the CCRs you'll find the subordination clause or language that allows the bank to take first lien position. But, big but, it is not absolutely true that HOA are always subordinate. The reason is that some of the HOAs were created without that clause and they simply refuse to add it. In Dallas we know there is at least one such HOA that the banks still provide purchase money loans for the properties, but the HOA technically could foreclose and wipe them out. So far, that hasn't happened.

Back to basics -- except for government liens, such as for taxes, liens are ordered by the date they are recorded. When you buy a house, the old owner pays off all liens (normally) creating clear title. Technically at this point the HOA's CCRs are the only encumbrance on the title. The buyer then takes the money from the closing table and pays for the property, creating the title in his name. Then the mortgage company records the deed of trust and becomes the "first" lien on the property. That's why we call it the first mortgage. Then any second mortgage deed of trust or other liens that are recorded afterward fall underneath the first mortgage.

Sp, why doesn't the tax man have the same problem, since his lien comes long after the first or second or mechanics? Because the goverment liens do supersede private liens.

The good news is that the HOA foreclosure is normally redeemable. You can pay them off and get your title back. The bad news for the HOA is that as the new owner, they are responsible for liens still in place above their claim. This normally includes the first mortgage and any later liens prior to the HOA's filing. (We're assuming here that the CCRs do contain a subordination clause.) So, while technically they do own it, if they don't pay the mortgage, they get foreclosed on and lose their claim.

Don't celebrate yet. You would have lost title, too. And a mortgage foreclosure is not redeemable. When the trustee sells your house for non-payment, say goodbye. It belongs to the bank (or whoever outbid the bank). This means if you don't pay your mortgage payment, the bank will foreclose and you won't get your house back. Before that bank foreclosure, just pay the HOA off to redeem the title to your name.

As always, consult an attorney before making a decision on what to do. This is a serious legal matter.
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0 votes
Mike Sayop, Home Buyer, Philippi, WV
Tue Nov 16, 2010
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HOA Paralegal, , Texas
Wed Apr 7, 2010
In the state of Texas, Homeowners Association can foreclose on the existing lien that runs for the life of the property. Many might think that it’s not right to do this, but we are simply doing our job; enforce the rules and regulations that each homeowner agreed and signed to when they chose to buy a house in an Association. Also, in the state of Texas most, but not all the Association are junior liens. Some are superior and do not subordinate their place to any mortgage, some are superior and sign a subordination agreement with the mortgage, and some are junior. To know exactly in what place your property falls, you must review the governing documents (usually referred as “Declarations of Covenants, Conditions and Restrictions”) for the Association you belong to.

Confused & Tired base on what you said, the Association you are member of informed you that they foreclosed on their lien in November 2009. That means that they foreclosed on November 3, 2009. Foreclosures are only the first Tuesday of every month and you must be notified 21 days before the sale by certified and regular mail. Whichever date you received notice that the foreclosure sale in fact took place; you have 180 days from that date to redeem your property. Pursuant to a new law that came in effect on September 2009, your lender can also redeem the property but not until the expiration of 90 days. Your questions are if the HOA supersedes the mortgage and who do you pay your mortgage. As previously mentioned, if the HOA supersedes the mortgage or not is a matter of investigating. Who should you pay your mortgage? That would be your decision after you read the below.

How an HOA foreclosure affects you? You will loose your property regardless of what position the HOA lien holds. Let’s assume that you are current with your mortgage and that there is not threat that your lender will foreclose, but you are not paying your HOA dues. Since you are still in default of the HOA lien, the HOA will foreclose on your property; give you 180 days to redeem it. Let’s assume that your HOA is not superior to your mortgage, which puts them in second positions. Even though, they are in second positions, they can still foreclose on your property and take possession of the property through eviction process. After a judge signs an eviction order, you must vacate the premise. Not vacating the premises after the order is given can bring you bigger legal issues.

Once you do not have a property, the probability of you continuing to you’re your mortgage note will likely not happen. This is when the lender will come and foreclose on its liens whipping the HOA lien, but that also means, that the Association will begin to receive payments from the lender since he is now the owner of the property by foreclosure and the property is free and clear of liens.

I hope that the above information helps you understand how the HOA foreclosures work. I recommend that if you still confuse seek the opinion of legal counsel. Although let me tell you that even after your property has been foreclose, you can still contact the firm who conducted that foreclosure and work something with them. Do not think that just because they foreclose it’s the end of the world and you have lost. Remember you still have 180 days of redemption. One thing is for sure, get ready for high legal fees which per the governing documents, an Association is entitled to reimbursement from the debtor.


All the information provided above is base of my personal years of experience as a HOA paralegal. In no way am I representing my employer, or client’s views on this matter.
0 votes
Doc & Ellen…, Agent, San Antonio, TX
Sat Dec 5, 2009
The authoritative answer is found in the Texas Property Code. See:

As a REALTOR®, I can't practice Law without a separate law license (which I don't have). So, your best bet is to contact a Board-Certified Real Estate Attorney (contact me if you need a reference). Give them the reference above.

The law states: (b) The owner of property in a residential subdivision may redeem the property from any purchaser at a sale foreclosing a property owners' association's assessment lien not later than the
180th day after the date the association mails written notice of the sale to the owner under Section 209.010.

I'll leave that to your attorney to interpret the rest.

Good luck.
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Corey Ehlers, , San Antonio, TX
Tue Dec 1, 2009
Are you more confused now then you were before you asked this question? I am not saying that any of the answers below are incorrect, but it seems like you got some answers that conflict with each other.

Bottom line, you need to communicate with your HOA and Mortgage Company to find out what is going on. HOA's are very powerful in Texas, and they can foreclose on your property, but you will be given plenty of notice before they do so. Most of the time they just file a lein on the propperty knowing that you will have to pay them off first before you could ever sell your property, but every HOA acts on its own, and every situation is looked at on a case by case basis.

It would also be a good idea to contact a Real Estate Attorney once you find out what the current situation is on your property.

Are you HOA dues past due? If so, how far past due?

Hope you get it all worked out....good luck!

Corey Ehlers
My San Antonio Home Loans
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Ann Gill, , San Antonio, TX
Mon Nov 30, 2009
yes, HOA does supersede mortgage lein
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Josh M. Boggs, Agent, San Antonio, TX
Mon Nov 30, 2009
Hello Confused and Tired,

In TX an HOA does have the legal authority to foreclose on your home, however it does not take precedence over your mortgage. What this means to you is that yes, you can still be ordered out of your home, and whoever purchases the HOA lien on the courthouse steps gets control over your home, but not free-and-clear like he would if he was picking up the lien from the sale of the primary lien position (ad-valorem and then mortgage).

I believe and I may be right on this, but you would have a 6-month redemption period to make up the payments to the HOA in order to re-take possession of your home. If it's a condo you own, I believe that there is absolutely NO redemption period, so you'd really have to take this quite serious.

Please be aware that if the HOA does foreclose on you; it does not mean you still retain the rights to still reside in the house. If you have gotten this far, you certainly may want to talk to a real estate attorney for more guidance on your rights to be sure of what step to take. Every situation is unique and challenging in it's own way, so perhaps you would like to seek further consultation from an experienced agent that can point you in the right direction.

God bless,
Josh M. Boggs
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Danny T Thom…, , Austin, TX
Mon Nov 30, 2009
Something sounds very fishy. I agree with Justin that you would have heard from them way before they took this drastic measure. My guess is that it might be a scam. I suggest you go to the county records and find out what documents have been recorded - all foreclosures of any kind have to be filed prior to action. The guidelines are strict, and the protections for you as a homeowner are substantial.
So, typically, the HOA CAN foreclose but that does not cancel the mortgage. You still owe the money, and the bank can also foreclose and then duke it out with the HOA... It really depends on your deeds and restrictions - read that carefully, and read your Deed of Trust. So technically, the lien does not supercede, but anyone with a lien can foreclose... but that doesn't mean they get title free and clear... Also, you can negotiate with the HOA and buy your rights back... It woun't be cheap because they will want ALL their money.... And again, with all of that said, there are proper NOTICE laws so you should have heard about this long ago...

You really need to contact an attorney. If you need a name, I have a few I trust completely... yep... lawyers you can trust... ;-)
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Justin Werner, Agent, San Antonio, TX
Mon Nov 30, 2009
First of all, an HOA wouldn't just send you one letter saying they have foreclosed. They would send a letter saying you're late and you need to pay them, then another one saying they WILL foreclose on your home if you don't pay. An HOA is generally a junior, or secondary, lien. All secondary liens are extinguished when a house is foreclosed on. If the HOA indeed bought the home at auction they paid off the first lien holder (who you paid your mortgage to) and now own it. Contact your mortgage servicer and see if this is indeed what has transpired. If they've already foreclosed, you can expect a sheriff to arrive any time. Sorry for your situation, but it sounds like it might be too late for you.

Justin Werner, ABR, CDPE
Accredited Buyer Representative
Certified Distressed Property Expert
RE/MAX Exclusive
0 votes
Rodney Jordan, , San Antonio, TX
Mon Nov 30, 2009
With most liens the rule is "first in line, first in time" meaning in the order in which they where filed. Tax lien are alway priorty and will have to be paid first in most states. For more information feel free to give me a call.

Rodney Jordan
Keller Williams Realty (San Antonio)
0 votes
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