In June 2022 the Colorado State Legislature and Governor Polis signed and passed into law Colorado HB-1137. This bill is complex and includes many procedural requirements and restrictions of HOA's and how they assess and collect dues, fines, and special assessments on individual homeowners within the community.
Below is an outline of some of the bill's requirements regarding the HOA's ability enforce the collection of money owed to the HOA.
Requires the HOA:
- To develop and adopt a policy to provide delinquent notice to the 'past due' homeowner which must include:
A. Description of the violation
B. Describe HOA steps for resolution before legal action occurs and
C. Describe the types of legal action that will be taken by the HOA
- The Notice must be Delivered to the homeowner 3 different ways as follows:
A. One is required to be via certified mail AND
B. Post notice on delinquent property AND
C. One other form such as text, email or regular mail to mailing address on file
- To limit the interest charges on late payments to 8% on dues, fines or assessments
- To have the board vote in the majority, before referred a homeowner to a collection agency. The property manager alone no longer has the power to do this on behalf of the HOA. It must be voted on by the board.
- To send a MONTHLY notice to offending homeowner itemizing a list of outstanding balance and detail amounts owed
Other important features of the bill include
- The HOA can no longer pursue foreclosure against homeowner solely based on fines owned to the HOA, but the HOA can still place a lien on the property for amounts owed to the HOA.
- The bill provides remedies to the homeowner if the HOA does not follow the rules established by the bill.
This is a summation of some of the bills features that affect an HOA's ability to impose fees and fines on its homeowners. The bill is lengthy and very involved, and readers should read Colorado HB-22-1137 in its entirety and consult with an attorney to interpret the legal ramifications of this bill.
Denver West Insurance Brokers is located in downtown Golden, Colorado. We have clients all over the state and serve the communities of Denver, Lakewood, Littleton, Morrison, Arvada, Wheat Ridge, Evergreen, Westminster. Give us a call at 303-960-5290 and speak to one of our licensed agents about your insurance needs.
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