On Wednesday May 25, 2011, a bill that would limit the foreclosure powers of homeowners' associations passed through a NC state House committee and is now expected to be heard by the full house.
A House Judiciary Subcommittee endorsed House Bill 165, which would require dues or assessments to remain unpaid for at least 90 days before an association could begin foreclosure proceedings against the property owner. Right now as it stands the association only has to wait 30 days to file against a property.
The bill would also require the association's executive board to vote to begin any foreclosure proceedings against an owner.
Rep. Jennifer Weiss, D-Wake, a primary sponsor of the bill, said any foreclosure can affect the entire neighborhood through declining property values, so the elected bodies of homeowners' associations should have to vote to foreclose on properties. The 90-day provision, would give the owner and the association more time to work out a solution.
The bill would also require more disclosure to potential home buyers about HOAs, but if approved, the bill will increase expenses of homeowners associations and the fees that all association members have to pay.
If it passes the full House, it will move on to the Senate for another vote.
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