California HOA Collections & Dues Guide

Key Points

• California HOAs are governed primarily by the Davis-Stirling Common Interest Development Act.
• Strict notice, timing, and due-process requirements apply before late fees, liens, or foreclosure may occur.
• Boards must offer payment plans and follow consumer-protection rules when collecting delinquent assessments.

Official Statutes & References

• Davis-Stirling Common Interest Development Act
• California Civil Code §5600–§5740 (Assessments & Collections)
• California Nonprofit Mutual Benefit Corporation Law
• California HOA Foreclosure Protections (Civil Code §5705)

Process Timeline

1. Assessment Becomes Due (Day 0): Regular dues or special assessments are levied pursuant to the governing documents and adopted budget.
2. Delinquency Begins (Day 1): If payment is not received by the due date, the assessment becomes delinquent.
3. Late Fees & Interest (After due date): Late fees and interest may be charged in accordance with statute and governing documents.
4. Pre-Lien Notice (At least 30 days before lien): HOA must provide written notice of delinquent assessment and offer a payment plan before recording a lien.
5. Lien Recorded (After notice period): HOA may record a lien for unpaid assessments after statutory notice requirements are met.
6. Pre-Foreclosure Notice (At least 30 days before foreclosure): Separate written notice must be sent before foreclosure proceedings may begin.
7. Foreclosure (If Permitted) (After lien + notices): HOA may foreclose only if statutory thresholds and voting requirements are satisfied.

Requirements

Authority to Levy Dues

• Authority must exist in the declaration and bylaws
• Annual budgets establish regular assessments
• Special assessments must comply with Civil Code voting and notice rules

Notice Requirements

• Written notice of delinquency
• Pre-lien notice with itemized debt
• Offer of a payment plan before lien or foreclosure

Fees, Interest, and Costs

• Late fees capped by statute
• Interest limited to statutory maximums
• Attorney fees and collection costs recoverable only as allowed by law

Foreclosure Limits

• Foreclosure generally barred unless assessments exceed statutory thresholds
• Board approval required before foreclosure
• Fines and penalties alone cannot support foreclosure

Frequently Asked Questions

Can a California HOA charge late fees?

Yes, but late fees are capped by statute and must be authorized by the governing documents.

Does a California HOA have to offer a payment plan?

Yes. The Davis-Stirling Act requires HOAs to offer a payment plan before recording a lien.

Can an HOA foreclose for unpaid dues?

Only in limited circumstances. The delinquency must meet statutory minimum thresholds and strict notice and voting requirements must be followed.

Can fines be included in a foreclosure?

No. Fines and penalties alone cannot be the basis for foreclosure under California law.