Can HOA Fees Be Discharged In BK?
It is not uncommon for homeowners who file for bankruptcy also have past due HOA fees or even a lien on their property. Many homeowners also complain how stubborn and inflexible the Home Owners Association (HOA) Board of Directors and the HOA attorney are with any type of payment arrangements. When you file for bankruptcy, an automatic stay will be put into place and any collection effort by the HOA needs to stop. That includes HOA liens as well.
If you file a Chapter 13 bankruptcy, all past due HOA fees will be included in your repayment plan. For those who file a Chapter 7 bankruptcy the process is a bit more complicated. The HOA fees may be turned into unsecured debt which may mean you will not have to repay most or any of the HOA past due fees.
Although most HOA liens do survive bankruptcy you can avoid losing your home through foreclosure by overzealous HOAs when you file for bankruptcy. It is advisable to consult with an attorney when dealing with HOAs as most are very aggressive and inflexible regarding HOA fees and placing a lien on your home.