Toby Newton owed his homeowners association $977. Today the association owns his house. It bought the place at a sheriff’s sale for $8,172 — and then offered to sell it back to him for $10,484.
Every step of that was legal. That’s the part that should bother you.
I’ve been a consumer reporter for more than 35 years, and I’ve watched plenty of small debts snowball. But a homeowners association turning three missed quarterly payments into a foreclosure is a special kind of math. Here’s how it happened, and how to make sure it never happens to you.
How $977 became a house
Newton, 53, bought a 1,750-square-foot home in Superstition Springs, a master-planned community in southeast Mesa, Arizona, in August 2022, financing it with a $449,328 loan. The Mesa Tribune, which broke the story, reports he lost his job in early 2024.
The quarterly assessment was $171. He missed three, maybe four. By the Tribune’s account, the unpaid dues came to $877, or $977 with the principal balance the HOA carried.
On Nov. 15, 2024, the Superstition Springs Community Master Association filed to foreclose. Ten days later, its law firm offered to make it go away for $3,980. All but $977 of that was attorney fees.
Newton says he offered $50 a month plus his regular assessment. Denied. He offered $200 a month plus the quarterly payments. Denied. The Tribune says no reason was given, and the association’s attorney didn’t respond to its requests for comment.
Meanwhile, the case rolled on. The foreclosure papers had been served on his partner’s adult son, whom Newton says wasn’t authorized to accept them. A default judgment came down June 30, 2025: $1,311 in assessments and late charges, $1,042 in collection costs and $3,345 in attorney fees.
On Oct. 16, 2025, with the debt at $6,579, the house went to a sheriff’s sale. The high bidder, at $8,172, was the HOA itself. Newton says he learned about the auction two days before it happened.
Arizona gives you six months to redeem a home after a sheriff’s sale. That window closed. In April 2026, the association offered to sell the house back for $10,484. Newton filed an emergency motion to stop the process in May. As of last week, it was still pending.
“We’ve tried to settle multiple times with them and they refused to work with us,” his partner, Sherrie Patten, told the Tribune.
The rule that made it possible
Here’s what most homeowners don’t know: When you buy in an HOA community, you sign a document that gives the association a lien on your home. Miss your dues and that lien can be foreclosed, mortgage or no mortgage.
The bank’s loan doesn’t go away. It just becomes the new owner’s problem, or the reason the HOA buys the house for pocket change.
In 2024, Arizona law let an association foreclose once you were 12 months or $1,200 behind. Newton’s $977 in dues cleared that bar only because fees and costs piled on top.
The state has since fixed the rule. Senate Bill 1494, signed April 18, 2025, and effective last fall, raised the threshold to 18 months delinquent or $10,000 owed, whichever comes first.
It also requires the board to make “reasonable efforts to communicate with the member and offer a reasonable payment plan” before filing.
That law would have saved Newton’s house. It came a few months too late.
His story isn’t a one-off. A 2023 Colorado Sun investigation counted more than 250 Colorado homes sold at HOA-driven sheriff’s auctions since 2015, more than 100 of them for $60,000 or less.
One Aurora man’s $1,358 in dues grew to $8,649 with attorney fees. His home, bought for $267,500, sold at auction for $76,000 and was flipped for $520,000.
Colorado rewrote its HOA law in 2022 after ProPublica found more than 2,400 foreclosure cases filed by associations since 2018. Arizona rewrote its law in 2025. Every reform arrived after somebody lost a house.
Why this matters to you
About 78 million Americans live in roughly 373,000 community associations, according to the Foundation for Community Association Research. That’s more than a third of the nation’s housing.
If you’re retired, the odds you’re in one are higher, because the 55-plus communities, condo towers and golf-course developments retirees favor are almost all governed by associations.
And the trigger is rarely defiance. It’s a job loss, a hospital stay, a spouse’s death, a check that didn’t get mailed. The people who get foreclosed on by their HOAs are mostly people who had a bad year.
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5 moves that stop a small debt from taking your home
1. The day you fall behind, get the ledger in writing
Ask the management company for an itemized statement of everything you owe: assessments, late fees, interest, collection costs. Fees are where a $977 debt becomes $6,579. You can’t fight numbers you haven’t seen.
2. Offer a payment plan in writing, and keep the copy
Newton made his offers by phone and email. Put yours in a letter, date it, and keep proof it was sent.
In Arizona and Colorado, associations are now legally required to offer reasonable plans. Elsewhere, a written offer is evidence a judge can see.
3. Never ignore certified mail or a process server
A default judgment happens when you don’t show up. Newton’s papers went to someone else, and the case proceeded without him.
If you receive anything from a court or a law firm, respond, even if it’s just to say you dispute the amount. A judge can’t consider a payment plan nobody asked for.
4. Know your state’s threshold and your redemption period
Some states won’t let an HOA foreclose until you’re a year or more behind; some have no minimum at all.
Most states give you a window to buy the house back after a sale: six months in Arizona, 90 days in California, 180 days in Texas. Look yours up before you need it.
5. Get help before the lawyers get involved
Once a collection firm has the file, every letter costs you money.
A HUD-approved housing counselor can help you negotiate for free; the Consumer Financial Protection Bureau has a locator. Collection law firms are covered by the Fair Debt Collection Practices Act, so you can file a complaint with the CFPB if they cross the line.
The bottom line
An HOA lien is real debt secured by your home, and the fees attached to it can outgrow the debt itself in a matter of months. The system is built so that inaction is the most expensive choice you can make.
Toby Newton is still living in a house he no longer owns, waiting on a judge. If you’re a payment behind on your dues, don’t wait for a letter from a law firm. Pick up the phone today, then put it in writing tomorrow.
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