HOAs Take Members To Court

Article Courtesy of CLICK2HOUSTON

By Amy Davis
Published June 17, 2009


We've reported that HOA court filings against homeowners are increasing every year. Now, KPRC Local 2 investigative reporter Amy Davis is showing you which Harris County HOAs are going after their own members the most.


"It's sad. It's just pathetic," said Marsha Phillips, looking into the gated Camden Park Community Center.


Phillips and all of the homeowners in Camden Park in Northwest Harris County are locked out of their neighborhood pool.


Damage from Hurricane Ike has yet to be repaired and the last HOA meeting was June 12, 2007.


"I think homeowner associations need to have a regulatory body that they report to, someone that they have to be accountable to," Phillips said.


Attorney David Kahne says Texas law makes it difficult for homeowners like Phillips to fight back. He says associations have the ultimate authority -- the power to take your home if you don't pay your dues.


"The association is in the position where they make the rules, they enforce the rules and if you want to appeal it, you appeal it right back to the same board that made the rules and is enforcing the rules," explained Kahne.


It is true that HOAs cannot foreclose on your home for unpaid fines or fees. The law says HOAs can only foreclose for unpaid dues.


But homeowners who want reform say some associations manipulate payments.


For example, if you have an outstanding fine you're disputing when you pay your annual dues, some associations apply your payment towards the fine and then say you still owe your dues. HOAs claim this gives them the right to foreclose.


Sandy Denton is the general manager of Sienna Plantation's Residential Association and a member of Community Associations Institute, a national HOA advocacy group. Denton says even though the law gives HOAs foreclosure power, very few use it.


"I have been doing this in excess of 20 years," Denton said. "And I have foreclosed on two homes."


"In the vast majority of cases, the homeowner association has no interest in taking your home away," Kahne countered. "What they want is your money."


Beanie Adolph is a member of Texas Homeowners for HOA Reform and she says she has the numbers to prove HOAs are steadily increasing filings in court.


Harris County court records from 1985 through 2007 show some neighborhoods are filing against their homeowners more often than others.


Most of the cases do not end in foreclosure, but Adolph says the desired result is the same.


"This is the way they make their money," Adolph told Davis. "They file for foreclosure. It scares the homeowner, and they ante up whatever is being demanded."


Inwood North in Northwest Harris County is No. 5 on the list for filing 329 foreclosure actions in court since 1985. On average, that's 15 new cases filed every year.


Phillip's Camden Park neighborhood comes in fourth with 331 filings since 1985.


Rushwood, also on the Northwest side, is No. 3 on the list where the HOA has filed 341 cases between 1985 and 2007.


At No. 2 are three HOAs that represent several neighborhoods in Mission Bend on Houston's southwest side. Combined court records show the Mission Bend HOAs have filed 416 cases since 1985.


"Everyone makes a choice to buy into a deed-restricted community or makes a choice to buy into a community that doesn't have deed restrictions," said Denton.


"If you ask them why they do this, they will tell you 'because we can,'" said Lynn Walshack, a member of Texas Homeowners for HOA Reform.


But we got a different story from the HOA with the most foreclosure-related filings in Harris County.


"All I can say is we had to do what would work for us," said Debbie Cox, the president of the Sterling Green Community Improvement Association in East Harris County.


Court records show Sterling Green CIA filed against 610 homeowners from 1985 to 2007.


Cox says that tact just wasn't working.


"We were tired of the overly aggressive homeowner association management companies," Cox said.


Cox and the board of the Sterling Green Community Improvement Association recently voted to fire the management company and let the HOA work directly with people who live in the neighborhood.


She says the change has been a good one for homeowners.


"They're able to come in here and talk with us one on one," said Cox. "We will sit down and meet with a homeowner and discuss their situation."


We did call all of the HOAs mentioned in our story. We spoke with board members who wanted to appear in the story. Others either didn't want to talk or never returned our calls.


If you want to see the top 100 HOAs with the most foreclosure-related filings, click here.


We've also heard from many of you about how difficult it is to get information from your HOA.


A bill that would have made HOAs comply with the Texas Open Records Act didn't pass in the state Legislature.


Most HOAs are nonprofit organizations and must provide basic financial information when asked. Enforcing that, though, is the difficult part.


We've received dozens of e-mails from homeowners from the Woodlands to Katy.


Our legal panel is taking your calls about homeowners rights and HOAs on Thursday. The phone lines will be open from 4 p.m. to 6:30 p.m.

FIND IT: Top 100 HOAs With Most Foreclosure-Related Filings