Maryland HOA Laws: Handling HOA Fees and Financial Distress

Maryland HOA Laws

If you’re facing financial hardship due to medical bills, job loss, or unexpected expenses, you’re probably worried about paying your HOA fees. Maybe you’ve missed a few months and now you’re being sent notices and accruing late penalties. Eventually, your HOA will likely place a lien on your home and ultimately may try to foreclose or auction it off in a Sheriff’s Sale.

In this article, we’ll discuss the ways in which Maryland HOA laws apply to homeowners and how to address unpaid fees when in financial distress.

Understanding Maryland HOA Laws

Maryland has specific laws that govern Homeowners Associations (HOAs) and their operations. These laws define the role of HOAs and outline the rights and responsibilities of both the association and homeowners.

Under HOA laws, you have certain obligations to your HOA. These include:

  • Paying regular fees or assessments,
  • Paying late fees should you be delinquent on payment,
  • Maintaining your property in accordance with the HOA’s rules and regulations.

If you don’t pay dues and fees, your HOA can and almost certainly will take action to collect the debt.

Financial Hardships and HOA Fees

Financial distress can make it challenging to keep up with your HOA fees. Job loss, medical bills, or unexpected expenses can strain your budget, making it difficult to prioritize HOA payments. However, falling behind on your HOA fees can have serious consequences.

What Happens if I Don’t Pay My HOA Fees?

When you miss HOA payments, you may face late fees and interest charges. These additional costs can quickly add up—making it even harder to catch up on your overdue balance. If you continue to miss payments, your HOA may take more aggressive action.

Under Maryland HOA laws, your association has the right to place a lien—a legal claim against your home—on your property, if you fail to pay your fees. Liens can make it difficult to sell or refinance your property until the debt is resolved.

Your HOA may even initiate foreclosure proceedings to recover the unpaid fees.

You Have Options!

It’s essential to communicate with your HOA if you’re experiencing financial challenges. They may be willing to work with you to create a payment plan or temporarily adjust fees. Being transparent and honest about your situation may help you avoid more severe consequences and protect your home from legal action.

However, if you’ve already missed a number of payments and your HOA is threatening to place a lien on your home—or if they’ve placed a lien already—you do have other options available to you.

Strategies for Handling HOA Fees During Financial Hardships

Communication with the HOA

Don’t wait until you’re severely behind on payments to reach out to your HOA. The earlier you communicate your financial challenges, the more likely your HOA will be willing to work with you.

Be prepared to provide documentation of your hardship, such as proof of job loss or medical bills.

When you approach your HOA, come with a proposed solution. This could include requesting a payment plan that spreads your overdue balance over several months or asking for a temporary reduction in fees until your financial situation improves.

Many HOAs are open to negotiating with homeowners who show a genuine effort to meet their obligations.

If your financial situation is dire and you’re considering bankruptcy, consult with an experienced bankruptcy and foreclosure attorney. They will help you understand Maryland HOA laws and how bankruptcy will impact your HOA fees. They’ll help you determine whether bankruptcy is the right choice for your individual circumstances.

Will Bankruptcy Resolve My HOA Debt?

When you file for bankruptcy, an automatic stay gets triggered, which halts all collection activities and foreclosure proceedings. Chapter 13 and Chapter 11 bankruptcy will allow you to create a repayment plan to catch up on your HOA fees and other debts over time.

Chapter 13 Bankruptcy

When you file for Chapter 13 bankruptcy, you’ll propose a repayment plan to pay off your debts over a three to five-year period. Chapter 13 allows you to:

  • Consolidate your debts, including HOA liens, into a single and reasonable payment.
  • Potentially reduce the total amount you owe, especially if you have a lien on your home and it exceeds the value of your property.
  • Spread payments over a three to five year period, helping you catch up on debt without immediate financial strain.

Chapter 11 Bankruptcy

Chapter 11 bankruptcy is often used by businesses. However, it may also be a viable option for individuals—especially those with high levels of debt or who want to spread payments over a longer period than just three to five years.

Other benefits of Chapter 11 include:

  • Propose a plan of reorganization that restructures your debts, including liens, into more manageable payments over time.
  • Potentially negotiate with the HOA to reduce the total amount owed or extend the repayment timeline as part of your reorganization plan.
  • Retain control over your financial affairs as a “debtor in possession,” allowing you to continue managing your financial affairs while working through the bankruptcy.

The decision to file Chapter 13 versus Chapter 11 bankruptcy depends on your unique financial situation and should be decided with the help of an experienced Maryland bankruptcy attorney.

Knowing When to Contact a Bankruptcy Attorney

If you’re struggling to keep up with your HOA fees and other debts, it may be time to consult a bankruptcy attorney. Here are some signs it’s time to seek legal guidance:

  • You’re unable to make your HOA payments and have fallen behind by several months or more.
  • You’re facing foreclosure or legal action from your HOA.
  • You’ve had liens placed on your home as a result of unpaid HOA dues and fees.
  • You have significant other debts, such as credit card balances or medical bills, that you cannot pay.
  • You’ve exhausted other options, such as negotiating with your HOA or seeking financial assistance.

A bankruptcy attorney can review your financial situation, explain your options, and help you determine whether bankruptcy is the right choice for you.

Key Takeaways

  • Under Maryland HOA laws, you have to pay regular fees or assessments and any late fees you accrue.
  • If you fall behind on HOA fees due to financial hardship, your HOA may add late penalties, place liens on your home, or attempt to foreclose on your property.
  • You do have options. You can communicate with your HOA and try to negotiate a payment plan to catch up on dues and fees.
  • If you’re unable to catch up on payments or have had a lien placed on your home, bankruptcy can provide a way to address your HOA debt and potentially save your property from foreclosure.
  • Chapter 13 and Chapter 11 bankruptcy can help you create a payment plan to address property liens and resolve HOA and creditor debts.

Protect Your Home: Contact Steiner Law Group

Your home is more than just a building; it’s your most valuable asset. When financial troubles threaten your homeownership, it’s crucial to take decisive action.

At Steiner Law Group, we understand the emotional and financial stakes involved in protecting your home from HOA liens and potential foreclosure. Our team has a proven track record of helping Maryland residents navigate complex financial situations and find effective solutions.

We’ve assisted hundreds of clients in discharging millions of dollars in debt, allowing them to keep their homes and regain financial stability.

Contact Steiner Law Group today to discuss how we can save your home together. You can also call us at (410) 670-7060.


What is the statute of limitations on HOA liens?

  • Should your HOA decide to foreclose a lien, the process must be started within 12 years after the lien was recorded with your county’s Land Records Office.

Can an HOA take your home?

Do I have to pay HOA fees?

  • Yes, you’re required to pay HOA fees if you live in a community governed by an HOA. These fees are part of your homeownership obligations and are used to maintain common areas and provide services.
  • Failing to pay can lead to serious consequences, including late fees, liens on your property, and potentially even foreclosure.

If you are unable to pay your HOA fees, speak with a law firm like Steiner Law Group to explore your options.

Avatar of Eric Steiner, Esquire

About Eric Steiner, Esquire

Mr. Steiner graduated from the University of Michigan Law School in 2006. Since then, he has focused his practice on bankruptcy, real estate, commercial and consumer collections, including representing the third largest lender in the greater Baltimore area.