Bankruptcy? Beware of Your HOA

Posted on October 14, 2011 at 1:03pm by

Obscure section of 2005 law allows homeowner associations to collect monthly fees, despite the protections of personal bankruptcy law. As a slumping economy pressures more distressed homeowners to seek relief in the bankruptcy courts, legal experts and others are cautioning that an unusual pitfall awaits those who are members of a homeowners association in central Maryland, and elsewhere.

An obscure provision of a 2005 federal bankruptcy law allows these associations to impose fees and other costs on struggling homeowners that are unfair and harmful to people making honest efforts to repair their damaged finances, they say.



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