Committee approves homeowner-protection changes to HOA foreclosure process, adopts negotiated amendments

The Senate Local Government and Housing Committee on Thursday passed House Bill 25-1043, a measure that revises association foreclosure procedures to give homeowners additional notice and a potential period to sell before an HOA foreclosure sale. The committee recorded a 4-3 vote in favor following negotiated amendments.

Sponsor testimony said the bill responds to cases where homeowners lost entire equity because HOA foreclosure sales yielded little net value to the homeowner. The bill would require clearer notices to owners about outstanding balances, expand information on free resources regarding HOA collections, allow homeowners to request a sale period (nine months in the bill language), and give courts authority to set listing prices where parties dispute fair market value and, in some circumstances, to establish a lien in favor of a former homeowner if the foreclosure sale price is substantially below market value.