Senate panel advances two bills tightening HOA foreclosure limits, adding ADR and good‑faith requirements

Senator McLaurin, speaking for sponsors and committee members, described a pair of companion bills — SB 107 (LC550573S) and SB 108 (LC550574S) — aimed at reforming community association foreclosure procedures and creating a statutory alternative dispute resolution process for association disputes.

SB 107 was amended to prohibit a community association, and its subsidiaries, parents or affiliates, from acquiring property it foreclosed on; to change a flat lien threshold into a variable limit tied to 12 months of the association’s monthly assessments; and to extend the post‑foreclosure right of redemption period for owners from four months to six months. McLaurin said the changes were intended to curb perceived “inside‑game” purchases of foreclosed units and to strengthen owner protections.

SB 108 sets minimum ADR procedures for associations, requires parties to act in good faith and establishes an enforcement mechanism for bad‑faith delays. Committee discussion and sponsor amendments added a fee‑shifting element so an aggrieved party may recover reasonable attorneys’ fees if an association (or, as amended, any party) violates the good‑faith requirement. The substitute language also broadened the statutory text to refer to “parties” rather than only the association when describing duties and remedies.

Community association representatives said they feared the bills could unintentionally punish good‑faith associations and raise costs for homeowners. Beth Taylor, a community association attorney speaking for CAI Georgia, told the committee that judicial foreclosure already involves court oversight and that adding new administrative and ADR steps could increase association expenses and therefore assessments. “To facilitate the ADR processes … it’s going to essentially result in practically an increase in assessments across the board,” Taylor said.

Other committee members raised concerns about whether the reforms might enable an owner to avoid assessments by simply withholding payment for an extended period and about balancing protections for owners with the needs of associations to address abandoned or delinquent properties. Senator Mallow and others said the proposed changes aimed at “bad actors” but needed careful drafting to avoid unintended results for ordinary homeowners and volunteer boards.

The committee adopted a friendly amendment (moved and seconded on the floor) to add subsidiaries, parents and affiliates to the entities barred from buying foreclosed units, and then voted to advance SB 107 as amended. The committee also considered and approved SB 108 as amended; the substitute included the good‑faith timing requirement and the attorneys‑fees provision and the committee later amended language to make the duty bilateral (applying to “parties”) and to refer to the “aggrieved party” in fee recovery language.

Actions recorded in committee included the adoption of a Jones amendment (to add parent/subsidiary/affiliate language) and votes to advance both bills as amended. Committee leaders said they would continue to refine statutory language and implementation details, including whether fee‑shifting should be bilateral and precise definitions for good‑faith timelines.

SB 107: committee record shows the bill was advanced out of committee as amended. SB 108: committee record shows the bill was advanced out of committee as amended.