New TX Law For HOAs Give Homeowners More Time Before Foreclosure

Up until now, Homeowners Associations in Texas have been able to quickly foreclose on homes whose owners might owe just a few hundred dollars in late dues or assessments. A new state law took effect this week giving homeowners more time to make good on their debts.

Before January 1st, Homeowners Associations were able to foreclose on homes without going through the courts.  Now, they have to ask a judge for an expedited order of foreclosure.  Homeowners would get an extra 60 days to cover whatever they owe a homeowners association. 

Kevin Cloves is a Houston attorney who represents both HOAs and homeowners.  He says this will slow the process of taking away homes from people whose HOA debt is just a fraction of the home's value.

"The extra time that's given to the homeowner provides them with an added opportunity to save their property by virtue of maybe coming up with a loan from friends, working out a payment plan with the HOA."

And the new laws do require HOAs to offer payment plans of up to 18 months.  Terry Sears is another Houston attorney who specializes in HOA matters.  He says while the intent of the new laws is noble, the regulations will cost HOAs more to achieve the same result.

"We're eventually going to get the foreclosure.  But now, we have to jump through additional hoops which requires a lawsuit and service fees and court costs.  And it drove up the fees exponentially for the entire subdivision, and, in my opinion, unnecessarily so."

The new foreclosure rule is part of a batch of new laws governing HOAs.  Some of the regulations took effect last September.  They cover everything from flag displays, to where and how residents can collect rainwater for other uses.

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David Pitman

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