Simulation: a fictional property for practice.

An Arizona HOA foreclosure: a court case, then a sheriff’s sale

An Arizona HOA won a judgment for $14,000 of dues. The home sells at a sheriff’s sale. What do you actually get?

A fictional home in a planned community at a sheriff’s sale after an HOA foreclosure in Arizona.

• Sale: Sheriff’s sale after an HOA foreclosure judgment, Arizona
• HOA judgment: $14,000 of assessments, plus costs
• Value as-is: About $360,000
• First deed of trust: $245,000

Mission 1: When can an Arizona HOA foreclose?

Pick the right answer for a planned community.

• Only after the owner is 18 months delinquent or owes $10,000 or more, whichever comes first, through a court case
• After 30 days, by a trustee’s sale like a mortgage

Condominiums follow a separate statute with the same 18-month or $10,000 rule and the same special assessment rule (A.R.S. 33-1256).

Mission 2: What do you get when you win?

Pick everything that’s true.

• A certificate of sale, not a deed yet
• The owner can redeem for 6 months (30 days if the court found the home abandoned and not used for farming or grazing) by paying my price plus 8%, plus taxes or assessments I paid, with interest
• The $245,000 first deed of trust stays with the property
• I can pay over a few months

You may wait 6 months for a deed, with the loan still attached.

Mission 3: The real price

• Your winning bid (example): $20,000
• First deed of trust that stays: $245,000
• Repairs and holding for 6 months (example): $30,000
• Total: $295,000 for a $360,000 home, before selling costs
• If the owner redeems: You get your $20,000 back plus 8%, but not your holding costs or repairs

About $65,000 of room before selling costs, a 6-month wait and a loan you must pay off to sell. Thin for the risk.

Would you bid $20,000?

Buy, investigate or pass? Work through the drill to see what an experienced investor would weigh.