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ARE HOMEOWNERS ASSOCIATION DUES DISCHARGEABLE IN BANKRUPTCY?

Do I owe HOA fees after bankruptcy?

Does Chapter 7 bankruptcy eliminate your liability for HOA fees? 

Answer: Yes and No. 

Generally, all past due homeowners association dues owed before filing a Chapter 7 bankruptcy are discharged (wiped out, forgiven completely).  

But, all HOA fees / dues incurred after the bankruptcy filing date are your responsibility (not discharged) as long as you remain on title to your real estate property. 

It does not matter whether you are living at the property or not.  It does not matter whether the property is occupied or vacant.  The issue is: Are you still the owner on title?  

Therefore, when you file bankruptcy, and are going to walk away from your property via foreclosure, until the foreclosure sale is complete (thereby changing title out of your name), you remain responsible to pay for HOA fees after bankruptcy.   And that could be for months, or even years, depending on the lender and the circumstances.
 

The reason (rationale, legal logic) for the post bankruptcy liability is because HOA dues are incurred month to month, i.e., every month is a new fee.  And the rule is that debts incurred before the bankruptcy filing date are discharged.  But debts incurred after the bankruptcy filing date (including HOA dues) are not discharged.  

See related article: HOA Liens and Bankruptcy.


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 Disclaimer

Under the new bankruptcy laws, Christian attorney, Matthew Tozer is a debt relief agency because he helps people file for bankruptcy relief under the Bankruptcy Code.

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