North Carolina HOA Lien and Foreclosure Laws

Updated for 2026

This page is part of AMG’s Guide to North Carolina HOA laws. It explains the North Carolina HOA lien laws that govern collections, from assessments and late charges through liens and foreclosure.

In this guide, the term governing documents refers collectively to the association’s plat, articles of incorporation, bylaws, declaration, rules and regulations, and all policies adopted by the board or the membership.

Which statutes govern collections

Collections are governed by the Planned Community Act (Chapter 47F) for planned communities and the Condominium Act (Chapter 47C) for condominiums, referred to on this page as “the Acts,” together with the declaration and the association’s collection policy.

Lien and foreclosure laws at a glance

Each Planned Community Act section listed has a Condominium Act counterpart with the same section number in Chapter 47C. Older communities, including planned communities created before 1999 and condominiums created on or before October 1, 1986, may not be subject to every rule on this page.

Late fees and other charges

Unless the declaration or articles of incorporation expressly provides otherwise, an association may charge a reasonable late fee of up to $20 per month or 10% of the unpaid installment, whichever is greater. Past-due assessments may also bear interest, up to a limit set by statute. An association may impose related charges if the declaration or articles expressly allows it.

Collections process

A written collection policy adopted by the board typically sets the timing of notices, the charges that apply, when an account goes to the association’s attorney, and whether payment plans are available.

The Acts require two written notices before certain steps. A statement of the amount due must be mailed to the owner at least 15 days before a claim of lien is filed, and a separate attorneys’ fee notice must give the owner 15 days from its mailing to pay the balance before any attorneys’ fees or court costs can be charged.

Disputes solely about unpaid assessments and related fines or fees fall outside North Carolina’s HOA mediation statute, discussed in AMG’s guide to North Carolina HOA dispute resolution.

Debt collection laws

North Carolina’s Debt Collection Act applies to an association collecting its own assessments, so collection communications must comply with it. The federal Fair Debt Collection Practices Act generally applies to third parties that collect debts for others.

HOA liens

An assessment unpaid for 30 days or more becomes a lien on the lot once a claim of lien is filed with the clerk of superior court in the county where the lot is located. The lien secures the amount due when it is filed and amounts that come due afterward, along with the late charges, fines, fees, and interest the Acts authorize.

Foreclosure

Because foreclosure can result in the loss of a home, the Acts set specific conditions for it. An association may foreclose a claim of lien under power of sale, as a lender would, only if the assessment has been unpaid for at least 90 days and the board votes to foreclose on that specific lot.

Before foreclosing under power of sale, the association must give the owner notice of its intent to foreclose. The owner may stop the foreclosure by paying the amount secured by the lien and the costs of filing and enforcing it.

Attorney involvement

The association’s attorney ordinarily handles the claim of lien, the notice of intent to foreclose, and any foreclosure. The owner may not be charged attorneys’ fees or court costs until the association has mailed the attorneys’ fee notice, and an owner who pays the balance within 15 days of that mailing owes no attorneys’ fees, costs, or expenses.

Payment plans

The board may, in its discretion, agree to let an owner pay an outstanding balance in installments, but neither the association nor the owner is required to offer or accept a payment plan. Reasonable processing fees may be added, and attorneys’ fees only after the attorneys’ fee notice.

How AMG supports the board

AMG provides administrative support for billing and recording assessments and other amounts due in the association’s name, assists in preparing account statements, notices, and ledgers, and processes payments consistent with the board’s policies and instructions. When the board refers an account to the association’s attorney, AMG can help compile the account documentation counsel requests. AMG can also prepare a draft collection policy for review by the board and counsel.

Account statements and notices are issued in the association’s name under the collection policy and instructions the board adopts. Decisions on whether and how to pursue amounts owed, including demand letters, claims of lien, payment plans, and foreclosure, rest with the association and its attorney.

When to involve legal counsel

Matters that commonly warrant the involvement of the association’s attorney include, but are not limited to, adopting or revising a collection policy, the statutory notices that precede attorneys’ fees and a claim of lien, filing and enforcing a claim of lien, any decision to foreclose, collection communications governed by debt collection law, and accounts involving a bankruptcy, an estate, a lender’s foreclosure, or a disputed balance. Whether and when to involve counsel is the board’s decision. At the board’s direction, AMG can help coordinate communications with the association’s attorney and assist in gathering the information counsel requests.

Frequently Asked Questions

Can an HOA foreclose on a home in North Carolina?

Yes, in limited circumstances. Foreclosure under power of sale requires that the assessment have gone unpaid for at least 90 days and that the board vote to foreclose on that specific lot or unit.

What happens when an owner stops paying HOA assessments in North Carolina?

Once an assessment is 30 days past due, the association may file a claim of lien with the clerk of superior court, at least 15 days after mailing the owner a statement of the amount due. Attorneys’ fees and court costs can be added only after a separate notice gives the owner 15 days to pay without them.

Can a North Carolina HOA charge late fees and interest on unpaid assessments?

Generally, yes. Unless the declaration or the articles of incorporation expressly provides otherwise, late charges may be up to $20 per month or 10% of the unpaid installment, whichever is greater, and past-due assessments may bear interest up to a limit set by statute.

Related Resources

• Guide to North Carolina HOA laws
• NC Planned Community Act
• NC Condominium Act
• North Carolina HOA dispute resolution
• North Carolina HOA meeting rules

Have questions about your own community?

Boards of AMG-managed communities are encouraged to begin with their community manager, who can help the board locate the relevant governing documents and other available information and, at the board’s direction, liaise with the association’s attorney when a legal question arises. Associations that are not currently AMG clients may contact AMG’s client services team for information about AMG’s management services or for referrals to qualified professionals.

AMG provides administrative management services to associations and is not a law firm. AMG acts on behalf of the associations it manages rather than individual owners, and an owner involved in a dispute with an association may wish to consult independent counsel.

About AMG

This guide was prepared by Association Management Group (AMG) community managers, including managers who hold the PCAM®, AMS®, and CMCA® credentials. AMG is an AAMC®-accredited firm serving more than 30,000 property owners across the Carolinas. The information is intended to assist community association members and leaders in understanding the statutory framework in which their associations operate.

Learn more at www.amgworld.com. Additional governance discussion appears in the Lessons from the Neighborhood series at www.LessonsFromTheNeighborhood.com.