Step-By-Step: How Does an HOA File a Lien?

You’re experiencing financial hardship and can’t afford to pay your HOA dues. After a certain number of missed payments, your HOA will file a lien against your property. Eventually, your HOA may foreclose on the lien and take your home.

Homeowners facing hardship are often unaware of the exact steps involved in “how does an HOA file a lien in Maryland?”

In this article, we’ll break down the process of how an HOA files a lien in Maryland.

Understanding HOA Liens in Maryland

An HOA lien is a legal claim your Homeowners Association (HOA) places on your property when you fail to pay your HOA dues, assessments, or other required fees. The lien allows your HOA to recover the debt you owe—giving them the right to collect the outstanding amount.

In Maryland, HOA liens are filed in accordance with the Maryland Contract Lien Act and the governing CC&R documents of your specific HOA. These laws and agreements outline the powers and procedures HOAs must follow when filing liens against delinquent homeowners.

How Does an HOA File a Lien? The Step-By-Step Process

When you fail to pay HOA dues or assessments, you become “delinquent.” Most HOAs have a grace period—typically 15 days—before considering a payment late, so it’s important to review your HOA’s policies. Once you have been late for a specific number of missed payments, your HOA will file a lien.

How does an HOA file a lien in Maryland? What’s the lien-filing process?

Step 1: Notification of Delinquency

The notification of delinquency is a formal reminder that you have outstanding dues and must take action to resolve the debt.

The notice must include specific information:

• The total amount due (including any late fees or interest).
• The payment due date.
• A clear explanation of the consequences of non-payment—including the HOA’s right to file a lien.

If you’ve received a notice of delinquency, take this notification seriously and respond promptly to avoid the situation escalating.

Step 2: Opportunity to Cure the Default

After receiving the notification of delinquency, you have a 30-day window to “cure the default” by paying the outstanding dues and associated fees. This is your opportunity to bring your account current and prevent the HOA from moving forward with the lien process.

If you can pay the full amount owed, do so as quickly as possible. However, if you’re facing financial difficulties, this may not be an option, so you can contact your HOA to discuss payment plan options.

If you don’t take action within this 30-day window, your HOA has the right to proceed with filing a lien against your property.

Step 3: Notice of Intent to File a Lien

The next step in the process of “how does an HOA file a lien” is to send you a formal “Notice of Intent to File a Lien.” This notice signals that the HOA is prepared to take legal action.

According to Maryland law, this notice must include:

• A detailed breakdown of the debt, including the total amount owed and any additional fees or interest.
• Clear instructions on the steps you must take to prevent the lien from being filed.
• The deadline for resolving the debt before the HOA proceeds with the lien filing.

You’ll typically have a short timeline to respond to this notice—around 10-15 days.

Step 4: Preparation of the Lien Document

If you don’t respond to the Notice of Intent, your HOA will prepare the official lien document. This document will be filed with your county and become a public record.

The lien document must include specific information:

• Your name and the property address.
• A detailed description of the property.
• The total amount owed, including dues, fees, and interest.

Step 5: Filing the Lien with the County

Next, your HOA will file the lien document with your county’s Land Records Office, making the lien a public record and officially initiating the legal process.

Filing a lien requires submitting the appropriate forms and paying the necessary filing fees. The specific requirements may vary by county but generally include:

• The original lien document, signed and notarized.
• A copy of the HOA’s governing documents.
• Proof of the required notices sent to you.

Typically, an HOA has 30-60 days after the end of the notice period to file the lien with the county. Once filed, the lien becomes a priority debt that must be paid off before any sale or transfer of the property can occur.

Step 6: Serving the Lien to the Homeowner

Your HOA must serve you with a copy of the filed lien document. In Maryland, there are several acceptable methods of serving the lien:

• Personal delivery to you or a resident of your property who is at least 18 years old.
• Certified mail to your last known address.
• Posting the lien document in a clear and visible place on your property if the other methods are unsuccessful.

If your HOA fails to follow the correct procedures or cannot prove that you were properly served, you may have grounds to challenge the lien in court.

Once you receive the served lien, take immediate action. Ignoring the lien will lead to more serious consequences which may result in foreclosure or your property being sold in a Sheriff’s Sale.

Step 7: Consequences of the Lien

Restrictions on Your Property Title

A lien makes it difficult or impossible to sell, refinance, or transfer ownership until the debt is resolved. This can be especially challenging if you’re experiencing financial difficulties and need to access your home’s equity or relocate.

Foreclosure or Sheriff’s Sale

If the lien remains unpaid, your HOA has the legal right to foreclose on your home or auction your property in a Sheriff’s Sale. Losing your home to foreclosure is a devastating outcome that can be difficult to recover from—both financially and emotionally.

Personal Liability

In some cases, you may be personally liable for the debt, meaning the HOA can pursue legal action against you individually, not just your property.

Accruing Interest and Penalties

As long as the lien remains unpaid, the debt may continue to grow with accruing interest and late payment penalties, making it harder to catch up.

What are My Options?

If your HOA has placed a lien on your property, you do have options to avoid HOA foreclosure.

For example, you can attempt to contact your HOA to discuss a payment plan or negotiate a settlement.

If you’re facing significant financial challenges, filing for bankruptcy may provide a path to managing the debt and saving your home. Contact an experienced bankruptcy and foreclosure attorney to discuss your options.

Prevent Foreclosure by Filing for Bankruptcy

If you’re facing foreclosure due to an unpaid HOA lien, filing for bankruptcy can save your home. When you file for bankruptcy, an automatic stay goes into effect, immediately halting all collection actions, including foreclosure proceedings.

Chapter 13 and Chapter 11 bankruptcy let you restructure your debts, including HOA liens, into a manageable payment plan spread over years.

Bankruptcy is a lifeline when you’re at risk of losing your property. Consult with an experienced bankruptcy attorney to explore your options and determine if filing for bankruptcy is the right choice.

Key Takeaways

• An HOA lien is a legal claim placed on your property when you fail to pay HOA dues or assessments.
• Before filing a lien, the HOA must provide notice of delinquency and allow time for you to resolve the debt.
• If you don’t resolve the debt, the HOA will send a Notice of Intent to File a Lien, then prepare and file the lien with the county.
• Consequences of a lien include difficulty selling or refinancing, personal liability,  and potential foreclosure.
• You have options to resolve the lien, such as payment plans, negotiation, or filing for bankruptcy.
• Filing for Chapter 13 and Chapter 11 bankruptcy can halt foreclosure and provide a structured way to manage the debt.
• Speak to a bankruptcy attorney to explore your options and protect your home.

Contact Steiner Law Group to Save Your Home

Don’t let an HOA lien jeopardize your homeownership. We’re here to guide you through your options and help you find the best solution to protect your property. Take control of your situation today. If you have more questions about “how does an HOA file a lien?” or bankruptcy, schedule a consultation online or call (410) 670-7060.