Amid a wave of legislation targeting Homeowners Associations (HOAs) in North Carolina, WRAL spoke to community associations attorney Adam Beaudoin about the potential implications.

One such legislation is House Bill 542. It seeks to amend laws governing the creation and enforcement of liens owed to homeowners and condo associations by modifying lien-related laws, enhancing notice requirements, and improving the foreclosure process, among other things.  

Adam explained the potential repercussions of the bill in the article: 

“It's going to be much harder for the association to enforce compliance with the rules and regulations,” Beaudoin warned. “The 3% that used to get away with stuff is going to grow from 3% to something else.” 

Raising the lien threshold, he said, “will allow folks who don't want to pay to have other members of the community subsidize their enjoyment of the community during a time when they're not paying.”

The article also discussed Senate Republicans' new language added to the bill designed to appease HOA opposition as well as add certain protections to homeowners unrelated to liens. One such provision calls for increased transparency of contracts between HOAs and their management companies.  Adam noted how this would affect HOAs. From the article: 

Beaudoin predicted the change would drive up the costs of management contracts for HOAs, forcing associations to pass those higher costs to members. “Management companies are going to have to figure out ways to make the juice worth the squeeze on one-year contracts without the automatic renewal.” 

Another change would ban those management companies from taking a percentage of the fines that an HOA collects. It’s intended to remove any motivation for management companies to issue excessive fines for minor — or even imaginary — violations, just to make extra profit.