North Carolina couple gobsmacked as HOA fees jump from $158 to $2,500 in 5 years — and state law puts no cap on how high they can go

“We are going to be forced out with nowhere to go, because no one is going to get a dime for their houses even if we put them on the market,” Jill Menson told WSOC-TV.

She and her husband were already struggling to pay the previous $1,200, plus a $10,000 assessment, up from $158 per month a mere five years ago.

These new fees leave them in a tight spot. Legally, there’s no limit to how high HOA fees can go in North Carolina. And if they don’t pay them, their HOA is legally allowed to put a lien on their house, allowing it to foreclose on their home.

Here’s how Magnolia Cove members ended up here, and how you can avoid dealing with a similar, burdensome HOA fee increase.

The rising HOA fees are part of an ensuing legal battle

While the HOA fee change was sudden, it didn’t come out of nowhere.

The Magnolia Cove HOA is run by one person: the developer of the neighborhood. In 2022, homeowners said that they have had difficulty accessing amenities and getting legally required financial information.

“We still don’t have our community mailbox,” homeowner Marsha Cheese told WCNC. “We have to drive eight miles round-trip to the post office in Sherrills Ford to pick up our mail.”

In an email to Moneywise, the Magnolia Cove Homeowners Association said that more than twenty homeowners from the community sued the HOA, and that those suits were unsuccessful. In return, the HOA says it countersued for “defamation and related claims,” which it says was successful.

“Defending the homeowner-initiated claims has produced large legal expenses,” the HOA told Moneywise. “Those legal bills are now the single largest item in the Association’s budget.”

It added that several lots are also behind on the assessments the HOA charged.

“Most of the owners now speaking publicly as aggrieved residents are the same parties who filed the lawsuits,” the HOA told Moneywise.

That means that the HOA could be seen as raising monthly HOA fees to make the homeowners who sued them pay for the lawsuit outside of court. There are still lawsuits pending against the Magnolia Cove HOA.

What to do if your HOA fees are too costly

If you find yourself facing HOA fees you can’t afford or fines you feel are unfair, you have options.