Here's How My HOA Ended Up Imposing a $5,000 Fine for a $30 Dead Bush

I recently bought a house from investors who had purchased it after a foreclosure. In this case, it wasn't the bank that foreclosed as a result of a late mortgage. Instead, the homeowners association foreclosed because there were unpaid fines and fees on the account. This gave the association the right to put a lien and establish an ownership claim, which gave it the right to foreclose.

Once I purchased it, I could see all of the past issues since the association wanted me to correct them (and because the investors had to pay off the outstanding balance due before we could close on the deal). One of the fines I saw was a $5,000 fine for a dead bush in the landscaping -- which I was able to replace upon moving in for $30.

It may seem impossible to believe, but this means my HOA fined homeowners $5,000 for a dead bush that cost just $30 to fix. Here's how that happened.

HOAs often have the right to impose fines for continuing violations

State laws governing HOAs vary from place to place. But, in general, most states give associations broad authority to impose fines for not complying with rules and regulations. Without this authority, HOA rules would essentially be meaningless since people could ignore them.

And, crucially, while the law typically imposes certain limits, like mandating that owners be told in advance they'll be fined and that fines must be reasonable, they don't typically stop associations from imposing daily fines for continuing violations.

In other words, if you're not in compliance with the rules, the HOA isn't limited to only fining you once. It can impose a fee for every single day you remain out of compliance. And that's exactly what happened to the owners of our house. They were told they had to replace the dead bush, for whatever reason they didn't, and they were fined $100 per day.

Now, in this case, the fine was capped at $5,000 because that's the rule of my association's bylaws. And, while Florida law says fines can be levied daily up to $1,000 total, there's an important caveat in the law. It says the $1,000 limit applies "unless otherwise provided in the governing documents." And, my HOA's governing documents have a $5,000 cap, not a $1,000 one.

Be sure you understand your association's rules

While it may seem ridiculous to be fined so much money for something that cost so little to fix, the reality is that there was nothing legally wrong with what the association did. And this is why it's so important to:

• Ask your realtor (or the HOA directly) for the rules and regulations before you buy.
• Read and understand your HOA's rules, including when you can be charged fees.
• Comply with the rules so you don't get hit with fees.
• Respond promptly to violations and fix them.

Ultimately, the prior owners lost their house because they didn't follow the rules. And this can and does happen to people every day. If you're buying in an association, you do not want this to be your fate -- so don't even consider purchasing in a neighborhood with these types of rules unless you're ready, willing, and able to follow them at all times.