RALEIGH, N.C. — Members of the North Carolina General Assembly are beginning to consider new legislation that, if passed, could take aim at the power of homeowners' associations (HOAs) in the Tar Heel State.
Members of the House have created an oversight committee specifically focusing on HOAs, and a pair of bills have also been filed to work on exactly how HOAs can take people's homes through the foreclosure process. While one bill that aimed to do away with HOAs entirely never got a hearing, a different one is making progress.
House Bill 542 (HB 542), for example, would make it harder for HOAs to put liens on people’s homes over minor issues if passed into law. For example, an HOA wouldn't be able to put a lien on a house if a homeowner owed a single, unpaid $20 fine. It also lays out a process for HOAs to provide proper notice about larger unpaid fines to homeowners and how the lien process would work in those cases.
Rep. Ya Liu, a Democrat from Wake County, is one of HB 542's primary sponsors, along with a trio of Republicans: Rep. Mark Brody of Anson and Union counties, Rep. Steve Tyson of Craven County, and Rep. Frank Iler of Brunswick County. Liu told WCNC Charlotte the bill she's put forward with her colleagues is about protecting homeowners from unreasonable actions.
"We are creating a threshold before your HOA can file foreclosures," she said, noting that an HOA wouldn't be able to take action until a year's worth of HOA dues is owed or until $2,500 in fees are owed -- whichever is less.
"We're trying to give people more time to be paying their dues before their homes are taken away," Liu added. "People work so hard to buy their home, and finally they have a place to live in. And we don't want to take that American dream away from them."
The bill also would direct HOAs to not only send certified mail to delinquent homeowners but also to collect contact information like phone numbers and emails to provide multiple avenues of notice.
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