California Civil Code Sections 5600-5740 govern HOA assessments. Regular assessments cannot increase more than 20% annually without member approval. Special assessments exceeding 5% of the budgeted gross expenses require member vote. The association may record a lien for delinquent assessments after required notices.
Under California Civil Code Section 5605, the board may not impose a regular assessment increase greater than 20% above the preceding fiscal year's assessment without approval of a majority of a quorum of members at a meeting or election. Special assessments exceeding 5% of the budgeted gross expenses for that fiscal year also require member approval. Before recording a lien for delinquent assessments, the association must follow the notice procedures in Section 5660: a written demand for payment sent by certified mail at least 30 days before recording the lien, a board decision to record the lien in an open meeting with at least 10 days notice to the owner, and recording of the lien in the county recorder's office. Foreclosure of an assessment lien requires the delinquency to exceed $1,800 or be more than 12 months delinquent under Section 5720. The association must offer a payment plan (minimum 12 months) before initiating foreclosure proceedings. Small claims court may be used for delinquencies up to $12,500.
Delinquent assessments accrue interest at up to 12% per annum plus reasonable collection costs. The association may suspend common area privileges. Judicial foreclosure is available for debts exceeding $1,800 or 12 months delinquent.
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