When an owner falls behind, how the HOA applies their payments and stacks liens can snowball a small debt into a foreclosure. This bill governs HOA assessments, liens, and how member payments are applied — core protections against runaway collection costs.
In short: Governs HOA assessments, liens, and how member payments are applied.
Introduced — no action Mixed
This bill overhauls how condo and planned-community associations collect unpaid assessments, place liens, and foreclose. It sets a minimum delinquency threshold before foreclosure, requires payment plans and advance notice, dictates how partial payments are applied, and mandates account statements. It aims to slow foreclosures and give owners more warning and clarity about what they owe.
For homeowners: A mixed rewrite of assessment collection. The owner-friendly parts are real: partial payments must pay down the foreclosable assessment balance before fines, the board must offer a payment plan before foreclosing, and the foreclosable lien is separated from a non-foreclosable fines/fees judgment. But it keeps a low delinquency threshold before foreclosure can begin. Real protections paired with a real gap — Mixed.
What the bill actually does, point by point — from the Arizona Legislature’s official fact sheet.
- An association may foreclose an assessment lien only when the delinquency is at least one year old or $1,200 or more, whichever occurs first.
- Before filing a foreclosure action, the board must make reasonable efforts to communicate with the owner and offer a reasonable payment plan.
- Payments must be applied in a set order: unpaid assessments, then due assessments, late charges, collection fees, attorney fees, then other charges (unless the owner directs otherwise in a signed instrument).
- A 30-day written notice, sent by certified mail with return receipt, is required before sending the debt to a collection agency or attorney, and must include contact info for discussing payment.
- Associations with 50 or more units/lots that use third-party management must provide periodic statements of account showing the current balance and ledger history.
- Associations must accept multiple payment methods (cash, check, bank draft, card, electronic transfer) but may pass through an approximate convenience fee for third-party processing.
- The association may not transfer ownership or control of the debt. Amends A.R.S. §§ 33-1202, 33-1256, 33-1802, 33-1807.
The A.R.S. sections this bill amends, adds, or repeals — taken from the bill text. Click one to read the current law.
Organizations and industry insiders who registered a position on this bill through the Legislature’s public Request to Speak system — simply where each stood: For, Against, or Neutral. Individual homeowners are not listed. Whether this bill helps or hurts homeowners is our own read, shown by its label above — a group’s position doesn’t set our call. Each row links to that entity’s report card and to the source at azleg.gov.