California HOAs may levy regular and special assessments, charge late fees and interest, record liens, and ultimately foreclose on delinquent owners under the Davis-Stirling Act. State law (Civil Code sections 5650-5740) caps fees and interest and imposes strict notice steps and a delinquency threshold before any foreclosure may proceed.
Under Civil Code section 5650, an assessment is delinquent 15 days after it is due. The HOA may add a late charge of 10% of the delinquent amount or $10, whichever is greater, plus interest up to 12% per year and reasonable collection costs and attorney's fees. Before recording a lien, the association must mail a 30-day itemized pre-lien notice by certified mail (section 5660). Section 5720 bars nonjudicial foreclosure to collect regular assessments unless the delinquency (excluding fees, interest, and late charges) reaches $1,800 or is more than 12 months overdue. Smaller debts must be pursued via small claims or a recorded lien instead.
Owners who fall behind face late fees, 12% interest, collection costs, attorney's fees, a recorded lien and, once the $1,800/12-month threshold is met, judicial or nonjudicial foreclosure and forced sale of the home.
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