A good Arizona HOA collections policy spells out due dates, late-charge amounts within statutory limits, a notice sequence, payment-plan options, and when accounts go to the association’s attorney, while respecting A.R.S. § 33-1807 limits on liens and foreclosure. Transcend helps Maricopa and Pinal County boards apply a written policy consistently, with collections and lien work coordinated through attorneys.
Why your HOA needs a written collections policy
Every owner pays for the community’s landscaping, pools, insurance, and reserves. When some owners don’t pay, everyone else carries the shortfall. A written policy adopted in an open meeting protects the association in three ways: it makes treatment of owners consistent, it gives owners clear expectations, and it lets the manager act promptly without the board debating each account. Consistency also matters if a collection action is ever challenged.
Arizona rules boards should know
- Late charges: For planned communities, A.R.S. § 33-1803 generally treats an assessment as not delinquent until 15 days after its due date and limits a reasonable late charge to the greater of $15 or 10 percent of the unpaid assessment installment. Condominiums have similar provisions in the Condominium Act; confirm with counsel.
- Statutory lien: A.R.S. § 33-1807 gives the association a lien on the owner’s unit or lot for assessments and certain related charges. Condominium associations have a comparable lien under § 33-1256.
- Foreclosure threshold: An association generally may foreclose its assessment lien only if the owner has been delinquent for one year or more or owes $10,000 or more, whichever occurs first. Fines and penalties are treated differently and generally cannot support foreclosure.
- Application of payments: Arizona law sets an order for applying owner payments, starting with unpaid assessments. Your accounting system and policy should follow it.
- Fair debt collection rules: Collection letters from attorneys and agencies must also comply with consumer debt collection laws.
See our overview of Arizona HOA liens and foreclosure for more context.
This is general information, not legal advice; your governing documents and an Arizona HOA attorney control.
Sample collections timeline
Your attorney should review the actual days, amounts, and notice wording. A typical structure looks like this:
| Stage | Typical timing | Action |
|---|---|---|
| Due date | Per declaration (often the 1st) | Statement or coupon reminder; auto-pay drafts |
| Grace period | Through day 15 | No late charge |
| First late notice | After day 15 | Late charge applied within statutory limit; friendly reminder with payment options |
| Second notice | About 30 to 45 days past due | Account balance, payment-plan offer, and warning of next steps |
| Final pre-referral notice | About 60 to 90 days past due | Written notice that the account will be referred to the association’s attorney |
| Attorney referral | Per policy | Demand letter, recorded lien where appropriate, collection action |
| Foreclosure review | Only after statutory threshold | Board decision on counsel’s recommendation |
Payment plans: fair and documented
Most owners who fall behind want to catch up. A written payment-plan option gives them a path and usually recovers more money, faster, than legal action. Good payment-plan terms:
- Are offered on the same terms to every eligible owner
- Require current assessments to be paid on time in addition to the plan amount
- Are in writing and signed by the owner
- State what happens if a plan payment is missed
- Are tracked by management and reported to the board
Point owners to our homeowner page on late payments and payment plans and to auto-pay setup, which prevents many delinquencies in the first place.
What to include in your collections policy
- Assessment due dates and accepted payment methods
- Grace period and late-charge amount within statutory limits
- Interest, if allowed by your documents and law
- Notice schedule and delivery method
- Payment-plan eligibility and terms
- Returned-payment handling
- Referral point to the association’s attorney
- Who may approve waivers and under what standard
- Board review of delinquency reports, with owner names handled in executive session where appropriate
Delinquent account discussions often belong in a closed session; see our guide to executive session rules.
Preventing delinquencies before they start
The cheapest collection is the one you never need. Arizona boards can reduce delinquencies with a few simple habits:
- Encourage auto-pay at closing and in welcome packets for new owners.
- Send clear annual notices when assessment amounts change so auto-pay and bill-pay amounts get updated.
- Remind seasonal residents and snowbirds about due dates before they leave for the summer.
- Make it easy to pay by ACH, card, eCheck, or a mailed check to the lockbox address printed on the statement.
- Reach out personally, through management, when a reliable payer suddenly misses a payment; a short conversation often resolves it.
Track the delinquency rate monthly. A rising trend is an early warning for your budget and cash flow.
How Transcend handles collections for your board
Transcend applies your adopted policy every month: billing, AR, late notices, payment-plan tracking, and attorney referrals for liens and collection actions, all reported in your monthly financials. Owners can pay anytime online through the resident portal, and Bruno, our AI Concierge, can send owners their account statements by text or email 24/7, with people handling every decision and escalation. Learn more about our HOA collections services and accounting and financial reporting, or request a proposal.
Frequently asked questions
For planned communities, the statute generally limits a late charge to the greater of $15 or 10 percent of the unpaid assessment, and it cannot apply until 15 days after the due date. Check your documents and counsel for your community.
Generally only when the owner has been delinquent for at least one year or owes $10,000 or more, whichever occurs first, and only for assessment-related amounts. Foreclosure decisions should always involve the association’s attorney.
Waivers are allowed when your policy permits them, but they should follow a written standard applied to everyone. Ad hoc waivers invite claims of unfair treatment.
Management typically sends early reminders and late notices under the board’s policy. Once an account is referred, the association’s attorney handles demand letters, liens, and legal action.
This page is general information about Arizona community association practice, not legal advice. Your governing documents and an Arizona HOA attorney control how the law applies to your community. Statutes change; verify current text at azleg.gov.
