Tennessee HOA Collections & Liens

Section 1: How assessment collection and liens work in Tennessee

Tennessee draws a clear line through its HOA collections law, and the line runs through a date: January 1, 2009. Condominiums created on or after that date fall under the Tennessee Condominium Act of 2008, Tenn. Code Ann. § 66-27-201 et seq. — a framework based on the 1980 Uniform Condominium Act, not UCIOA — and those associations carry a six-month limited-priority lien. Condominiums created before that date land under the older Horizontal Property Act, Tenn. Code Ann. § 66-27-101 et seq. Planned communities occupy a third lane, with no single collections statute; they depend on recorded covenants and corporate law instead. For a 2008 Act condominium, the lien arises automatically from the moment an assessment or fine comes due, without any recording step.¹ Tennessee gives 2008 Act condominiums a limited super-priority ahead of the first mortgage: six months of common expense assessments, capped at one percent of the first mortgage's maximum principal, and structured as a payment priority only — it does not extinguish the mortgage.² Foreclosure runs through the courts by default and proceeds nonjudicially only if the declaration expressly allows it.³ The state sets no minimum dollar threshold and no minimum delinquency duration before an association may foreclose, with one narrow exception for certain homeowners' association special assessments.¹ That puts Tennessee between the aggressive super-priority states — Nevada's NRS 116.3116 grants a nine-month super-priority, and the Nevada Supreme Court held in SFR Investments Pool 1, LLC v. U.S. Bank, N.A., 334 P.3d 408 (Nev. 2014) that an HOA can extinguish the first deed of trust by foreclosing on that lien⁴ — and the threshold-restricted states like California, Arizona, and Colorado, sitting closer to a payment-priority model that protects lenders. The sections below detail the lien, its priority, and the operational sequence from first delinquency to post-sale.

Tennessee HOA Collections & Liens at a glance

Section 2: The lien and its priority

2A. Lien creation, authority, and what it secures

For condominiums created on or after January 1, 2009, the assessment lien is statutory. Under Tenn. Code Ann. § 66-27-415(a)(1), the association holds a lien on a unit for any assessment levied against that unit or fine imposed against its owner from the time the assessment or fine becomes due.¹ That lien arises automatically on the due date — no separate recording creates it, because filing the declaration itself constitutes record notice of the lien.¹² The portion of the lien that enjoys payment priority is perfected without any recording; any delinquent amount above the priority portion gets perfected by recording in the lien book at the register of deeds office in the county where the property sits, giving it priority over liens filed afterward.¹² When an assessment is payable in installments, the full amount becomes a lien from the time the first installment comes due.¹ Unless the declaration provides otherwise, fees, charges, late charges, fines, and interest charged under § 66-27-402(a)(10), (11), and (12) are enforceable as assessments, and any judgment must include costs and reasonable attorney's fees for the prevailing party.¹⁰ The lien attaches to the unit.

For condominiums created before January 1, 2009, the Horizontal Property Act governs. Under Tenn. Code Ann. § 66-27-116, unpaid assessments for an owner's pro rata share of expenses become a lien against the apartment if not paid before sale or conveyance, and pass to the new owner.⁵ This older regime carries no automatic super-priority mechanism. Certain provisions of the 2008 Act, including the § 66-27-415 priority rule, also reach pre-2009 condominiums for events occurring after January 1, 2009, under § 66-27-202(a).¹¹ For planned communities — single-family HOAs — there is no statutory assessment lien. The authority to lien is contractual, arising from the recorded CC&Rs, and the association typically operates as a nonprofit corporation governed by Title 48.⁶

2B. Lien priority and any super-priority component

The priority rule for a 2008 Act condominium is the single most important number on this page. Under Tenn. Code Ann. § 66-27-415(b)(1), the association lien is prior to all other liens and encumbrances on a unit except: (A) liens and encumbrances recorded before the declaration; (B) a first or other contemporaneous mortgage or deed of trust recorded before the date the enforced assessment became delinquent; and (C) liens for real estate taxes and other governmental charges.⁷

Tennessee recognizes a limited super-priority for 2008 Act condominiums. Under § 66-27-415(b)(2), when a lienholder or the association initiates foreclosure, the association takes priority in the sale proceeds up to the common expense assessments — based on the periodic budget — that would have become due during the six months immediately preceding institution of the enforcement action, but not exceeding one percent of the maximum principal indebtedness secured by the first mortgage.² This is a payment priority, not a priority of position: an association foreclosure is subject to any prior mortgage and does not extinguish it, and the six-month right is not transferable — it is extinguished if assigned to a third party.² A 2016 amendment confirmed that Tennessee grants only this payment priority, separating the state from jurisdictions where courts read similar uniform-act language to let an association foreclosure wipe out the first mortgage.¹³ The priority does not apply if the lender gave the association its name and address and the association then failed, within thirty days of the date six months of assessments became delinquent, to notify the lender of the delinquency.¹⁴ The statute does not affect the priority of mechanics' or materialmen's liens.⁸ On the rolling-lien question, the statute frames the six-month amount as a single reach-back measured from the institution of the enforcement action rather than a sum that resets in successive periods.² Pre-2009 condominiums and planned communities carry no super-priority.⁵

2C. CC&R interaction, corporate-law overlay, and federal overlay

Recorded CC&Rs supplement the statute and, for condominiums, the declaration controls several variables: whether fees and fines are recoverable as assessments, whether power-of-sale foreclosure is available, and whether the declaration reserves a right of redemption. The 2008 Act cannot be varied or waived for residential condominiums, so a declaration cannot expand the super-priority beyond the statutory six months or grant a planned-community HOA a statutory lien it does not have.¹⁵ The underlying assessment debt is a contract obligation subject to Tennessee's six-year statute of limitations for written contracts under Tenn. Code Ann. § 28-3-109, while the condominium lien itself is extinguished unless enforcement proceedings begin within six years after the lien becomes effective under § 66-27-415(e).¹⁶

Three federal frameworks apply on top of the Tennessee framework regardless of state law. The Fair Debt Collection Practices Act can reach associations and, in particular, their attorneys and third-party collection agents acting as debt collectors. The automatic stay under 11 U.S.C. § 362 halts collection and foreclosure the moment an owner files bankruptcy. The Servicemembers Civil Relief Act restricts default judgments and foreclosure against active-duty servicemembers.

Section 3: The collection and foreclosure process

3A. Pre-lien collection sequence

For 2008 Act condominiums, Tennessee imposes no statutory pre-lien notice. The lien arises automatically when the assessment or fine comes due, and the priority portion is perfected without recording — there is no statutory notice-of-delinquency or notice-of-intent-to-record step before a lien exists.¹ The only affirmative statutory disclosure runs the other direction: on written request from a unit owner or a mortgage holder, the association must furnish a written statement of unpaid assessments within seven days, and that statement binds the association.¹⁷ The statute does not require the association to offer a payment plan or a debt-dispute procedure before a lien attaches. For planned communities, any pre-lien notice, payment-plan, or dispute right is contractual and depends entirely on the recorded CC&Rs — these steps are not statutory.⁶

3B. Recording and the pre-foreclosure sequence

For 2008 Act condominiums, recording the declaration itself serves as record notice of the lien, and no further recording is required to perfect the six-month priority amount.¹² To perfect a delinquent amount above the priority portion, the association records it in the lien book at the register of deeds office in the county where the property sits.¹² Where the association forecloses nonjudicially under a power of sale, § 66-27-415(a)(2) requires the association to give notice of its action to the unit owner and to all lienholders of record before the first publication required under Title 35, Chapter 5; notice by U.S. mail is sufficient and is deemed received three days after deposit.³ The statute does not require a recorded board vote, mandatory mediation, or a payment-plan offer as a condition of foreclosure for ordinary assessments. For planned communities, recording and pre-foreclosure steps are governed by the CC&Rs and are contractual, not statutory.⁶

3C. Foreclosure mechanics and thresholds

For 2008 Act condominiums, foreclosure may proceed by either of two paths. By default, the lien is foreclosed by judicial action — an equitable proceeding that may be brought in Chancery Court, the trial court that handles equity matters in Tennessee's bifurcated trial system (Circuit Court handles actions at law, and jurisdiction can overlap).³ Alternatively, if the declaration so provides, the association may foreclose in the same manner as a deed of trust with power of sale under Title 35, Chapter 5.³ Under the nonjudicial path as amended by the Tennessee Foreclosure Modernization Act effective July 1, 2025, the foreclosing party must publish notice in a newspaper at least twice — reduced from three times — with the first publication at least twenty days before the sale, and must also post the notice online through a registered third-party internet posting company for at least twenty continuous days; if there is no newspaper in the county, notice is posted in public places thirty days before the sale.¹⁸

Tennessee sets no minimum dollar threshold and no minimum delinquency duration before a 2008 Act condominium association may foreclose; the statute conditions foreclosure on the existence of the lien, not on a floor amount or a waiting period.¹ Fines, fees, and late charges are enforceable as assessments unless the declaration provides otherwise, so they can support a condominium foreclosure.¹⁰ The one statutory exception applies to planned-community HOAs: under § 66-27-706, an HOA cannot foreclose for failure to pay a special assessment for a nonessential amenity — such as a pool, tennis court, or clubhouse — and any such special assessment must first pass by a two-thirds vote of the total membership and be accompanied by financing or a payment plan.⁶ For planned communities generally, the availability and mechanics of foreclosure depend on the CC&Rs and are contractual.⁶

3D. Post-sale: redemption, deficiency, surplus, reinstatement

For a 2008 Act condominium association lien, the lien is not subject to any statutory right of redemption, homestead, or exemption unless the right is specifically reserved in the declaration.⁸ That is a meaningful departure from Tennessee's general rule, under which a foreclosed owner has a two-year right of redemption under Tenn. Code Ann. § 66-8-101 that deeds of trust routinely waive.⁹ A deficiency action is available: the foreclosing party may sue separately after a nonjudicial sale, and the deficiency may be limited to the debt minus the property's fair market value where the borrower demonstrates the sale price was materially less than value, under Tenn. Code Ann. § 35-5-117.¹⁹ Surplus sale proceeds above what is needed to satisfy the foreclosing lien and senior liens are distributed to junior lienholders by priority and then to the former owner. Tennessee provides no general statutory right to reinstate by curing arrears before sale except for high-cost home loans under Tenn. Code Ann. § 45-20-104; any reinstatement right otherwise comes from the loan or governing documents.²⁰

Section 4: Recent legislative and judicial activity

A. Recent bills

Tennessee's recent legislative action on collections has been targeted rather than sweeping. The 2024 and 2025 sessions produced two laws that directly affect assessment collection and foreclosure procedure — one pulling back association power over nonessential amenities, the other modernizing how sale notices reach the public.

B. Recent appellate rulings

Tennessee's appellate courts have delivered two decisions on collection-related issues since 2024. Both turned on procedural points — one on whether a missed appeal deadline dooms a challenge to an assessment judgment, the other on what obligations follow when declarant rights change hands.

C. Active legislative debates

Proposals for a general "Tennessee Homeowners Association Act" governing planned-community operations have appeared in past sessions without enactment. Incremental amendments to Chapter 27, Parts 6 through 8, remain the more likely vehicle for any change to collection or foreclosure rules.

Section 5: National positioning and related coverage

Tennessee sits in the middle of the national collections spectrum. The state offers a limited super-priority, but it is far weaker than the model that worries lenders: Nevada's NRS 116.3116 grants true lien priority — not merely payment priority — for nine months of assessments, and the Nevada Supreme Court held in SFR Investments Pool 1, LLC v. U.S. Bank, N.A., 334 P.3d 408 (Nev. 2014) that an HOA can extinguish the first deed of trust by foreclosing on its super-priority lien, whereas Tennessee's 2008 Act gives condominium associations only a six-month payment priority capped at one percent of the first mortgage and expressly cannot extinguish the mortgage.⁴ Tennessee also differs from the threshold-restricted states: the state sets no general minimum debt or delinquency duration. California bars foreclosure under Cal. Civ. Code § 5720 unless delinquent assessments equal or exceed $1,800 or are more than twelve months delinquent; Arizona raised its planned-community foreclosure threshold via SB 1494 (2025) to $10,000 or eighteen months delinquent, effective September 26, 2025; and Colorado's HB22-1137 (2022) bars foreclosure on fines and fees and requires a repayment-plan offer.²³ For condominiums, Tennessee is unlike pure CC&R-primary states because its condominium statute supplies a detailed lien — but for a planned-community HOA, Tennessee behaves much like a CC&R-primary state, since collection rests on the recorded covenants and corporate law. The practical implication for a multi-state operator is that a notice sequence or foreclosure path valid in one state can be defective or barred in another, so cure dates, priority amounts, and redemption rules must be set per state. Tennessee's current direction of travel is a modest tightening of owner protections — the 2024 nonessential-amenity foreclosure bar — alongside procedural modernization — the 2025 foreclosure-notice changes — rather than any move to expand association lien power.

1. Tenn. Code Ann. § 66-27-415(a), Tennessee Condominium Act of 2008, Acts 2008, ch. 766, amended by 2016 Tenn. Acts, ch. 866 (lien arises when assessment or fine becomes due; foreclosure by judicial action) ↩
2. Tenn. Code Ann. § 66-27-415(b)(2), Tennessee Condominium Act of 2008 (six-month payment priority capped at 1% of first-mortgage principal; subject to prior mortgage; not transferable) ↩
3. Tenn. Code Ann. § 66-27-415(a)(1)–(4), Tennessee Condominium Act of 2008 (judicial foreclosure default; power of sale if declaration provides; notice to owner and lienholders before first publication) ↩
4. SFR Invs. Pool 1, LLC v. U.S. Bank, N.A., 334 P.3d 408 (Nev. 2014) (NRS 116.3116 nine-month super-priority can extinguish a first deed of trust) ↩
5. Tenn. Code Ann. § 66-27-116, Horizontal Property Act (pro-rated expenses and taxes lien) ↩
6. Tenn. Code Ann. § 66-27-706, added by 2024 Tenn. Acts, ch. 691, SB 2150 / HB 2249 (special assessment for nonessential amenities; two-thirds vote, payment plan, no foreclosure) ↩
7. Tenn. Code Ann. § 66-27-415(b)(1), Tennessee Condominium Act of 2008 (priority over all liens except pre-declaration liens, prior first mortgage, and tax liens) ↩
8. Tenn. Code Ann. § 66-27-415(b)(3), Tennessee Condominium Act of 2008 (lien not subject to right of redemption, homestead, or exemption unless reserved; mechanics'/materialmen's liens unaffected) ↩
9. Tenn. Code Ann. § 66-8-101 (two-year right of redemption; waiver) ↩
10. Tenn. Code Ann. § 66-27-415(a)(4), (g), Tennessee Condominium Act of 2008 (fees, charges, late charges, fines, interest enforceable as assessments; costs and attorney's fees for prevailing party) ↩
11. Tenn. Code Ann. § 66-27-202(a), Tennessee Condominium Act of 2008 (applicability to pre-2009 condominiums for post-2009 events) ↩
12. Tenn. Code Ann. § 66-27-415(d), Tennessee Condominium Act of 2008 (declaration is record notice; priority portion perfected without recording; excess perfected by recording in register of deeds lien book) ↩
13. 2016 Tenn. Acts, ch. 866 (Public Chapter 866) (amendment clarifying Tennessee grants only payment priority, not priority of position) ↩
14. Tenn. Code Ann. § 66-27-415(b)(2)(B), Tennessee Condominium Act of 2008 (priority lost if association fails to notify lender within thirty days of six-month delinquency) ↩
15. Tenn. Code Ann. § 66-27-204, Tennessee Condominium Act of 2008 (act may not be varied or waived for residential condominiums) ↩
16. Tenn. Code Ann. § 28-3-109 (six-year limitations for written contracts); Tenn. Code Ann. § 66-27-415(e), Tennessee Condominium Act of 2008 (lien extinguished unless enforced within six years) ↩
17. Tenn. Code Ann. § 66-27-415(h), Tennessee Condominium Act of 2008 (written statement of unpaid assessments within seven days; binding) ↩
18. Tenn. Code Ann. § 35-5-101 et seq., as amended by the Tennessee Foreclosure Modernization Act, 2025 Tenn. Acts, ch. 515 (Public Chapter 515), SB 0727 / HB 1127, eff. July 1, 2025 ↩
19. Tenn. Code Ann. § 35-5-117 (deficiency judgment; fair-market-value limit) ↩
20. Tenn. Code Ann. § 45-20-104 (reinstatement for high-cost home loans) ↩
21. Robin Hood Condo Ass'n v. Wellman, No. M2023-01519-COA-R3-CV (Tenn. Ct. App. Apr. 17, 2024) ↩
22. Hidden Lake Resorts Homeowners Ass'n, Inc. v. Moore, No. M2022-01323-COA-R3-CV (Tenn. Ct. App. June 5, 2024) ↩
23. Cal. Civ. Code § 5720 ($1,800 / 12-month foreclosure threshold); Ariz. Rev. Stat. § 33-1807, amended by S.B. 1494, 57th Leg., 1st Reg. Sess. (Ariz. 2025) ($10,000 / 18-month threshold, eff. Sept. 26, 2025); Colo. H.B. 22-1137, 73d Gen. Assemb., 2d Reg. Sess. (Colo. 2022) (fines/fees foreclosure bar and repayment-plan requirement) ↩