Q: Does a voluntary HOA have a legal right to demand settlement of voluntary dues prior to a home / property sale?
1981 record plat subdivision. 41 one acre lots. Some folks own multiple lots. HOA created 2004 and is voluntary with no lien or assessment authority. Approx. 25% of property owners do not claim membership in the HOA. Since creation in 2004 the HOA has been claiming membership runs with the land, all property owners are members and must pay back dues when selling their property. Dues were $250 annual but may be going to $700 + annual. Estoppel letters are being used during closings to claim dues are owed. Some title companies ignore the letters and some are paying what is asked for. Dollars at issue average $3K to $5K. One owner will owe $15K when he sells. No signed agreements for dues. Whatever balance the previous owner had at time of sale is what new owner starts out with. I am selling (my dues are paid thru 2026) - I want to be an honest seller when asked questions about the HOA fees. In my mind - voluntary dues are donations - not legally binding debt obligations. Your thoughts?
A: An attorney would need to review the plat, the HOA documents and any documents any owners may have executed to purchase the lots or possibly consent to the HOA. Back in the 1970s-80s an "agreement for deed" was popular where language included in a deed committed owners to what was originally voluntary HOAs. There were also consent forms used back in the day as well. Another consideration is if there are private roads or private facilities. The law doesn't let owners use HOA property without being a member of the HOA. There are other scenarios where an owner could unknowingly consent to membership. This is a complicated area of HOA law that has lots of possibilities based on how the courts have handled these over the years if the issues were litigated.
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