New Colorado Law Protects Homeowners in HOA Foreclosures: What HB25-1043 Means for You
Colorado’s 2025 legislative session brought big news for homeowners and HOA boards alike with the passage of House Bill 25-1043, titled "Owner Equity Protection in Homeowners' Association Foreclosure Sales." Effective October 1, 2025, this new law introduces stronger procedural requirements for HOAs, more protections for homeowners facing delinquency, and greater transparency in foreclosure processes.
At Brightstar Management Group, we believe strong communities are built on fairness, clarity, and collaboration. Below is a summary of the key changes in HB25-1043 — and how we’re helping our clients stay ahead.
What Is HB25-1043?
HB25-1043 was designed to protect unit owners' equity and ensure due process when a homeowners’ association initiates a foreclosure due to unpaid assessments. The law does not eliminate an HOA's right to enforce liens — but it raises the bar for compliance, communication, and owner protection throughout the process.
Key Provisions of the New Law
1. Full Legal Compliance Before Foreclosure
Before pursuing foreclosure, an HOA must comply with:
State lien and foreclosure laws, and
Its own governing documents, including declarations, bylaws, and rules.
If the HOA is noncompliant, the court can pause (stay) the foreclosure to allow time for correction and may reduce or deny attorney fees related to the case.
2. Stronger Notice Requirements
HOAs must now include more detail in their notice of deficiency, such as:
A statement that the owner can request a copy of the ledger showing the debt (which must be sent within 7 business days).
A warning that nonpayment may lead to lien, foreclosure, and loss of equity.
A link to free credit counseling resources and information from the HOA Information and Resource Center.
3. New Notice Before Foreclosure
At least 30 days before filing a foreclosure action, the HOA must send a written notice to the homeowner stating:
That foreclosure will result in the sale of the unit at auction.
That the owner could lose some or all of their equity.
That free credit counseling is available and can be accessed through the state’s online resource center.
4. Notice of Right to Cure After Filing Foreclosure
Within 5 business days of initiating foreclosure, the HOA must inform the unit owner:
Of their right to cure the debt, and
Of their right to request a court-ordered delay in the auction by filing a motion.
5. Up to 9-Month Delay for Homeowners to Sell
After foreclosure is filed — but before the auction — the homeowner may petition the court for up to 9 months to list and sell the property at fair market value. The sale proceeds go into escrow and will be distributed based on a court decision.
The court may extend the stay if there’s good cause or if a sale is already in progress.
6. Annual Reporting Requirements for HOAs
As part of its annual registration with the Colorado Division of Real Estate, every HOA must now report:
Number of homeowners 6+ months delinquent;
Number of judgments filed against owners;
Number of payment plans initiated;
Number of foreclosure actions taken.
What This Means for HOA Boards
HOAs now face tighter timelines, stricter procedural requirements, and enhanced communication duties. Failure to comply can result in court sanctions, reduced legal recoveries, or delays in enforcement.
This is where Brightstar comes in.
How Brightstar Management Group Can Help
At Brightstar, we’re already integrating HB25-1043 into our operating procedures. Our commitment to compliance and service means:
✅ Proactive tracking of delinquent accounts with legally required notices
✅ Automated reminder systems and ledger request workflows
✅ Coordination with legal counsel to ensure procedural compliance
✅ Assistance to homeowners in understanding credit counseling options
✅ Accurate annual reporting to the Division of Real Estate
✅ Empowering boards with ongoing training and legal updates
We believe that protecting homeowner equity is not only a legal requirement — it’s the right thing to do.
Final Thoughts
HB25-1043 represents a shift in the power balance between HOAs and homeowners — emphasizing transparency, communication, and fairness in financial enforcement. It sets a new standard that responsible HOA management companies must meet — and Brightstar Management Group is ready.
For questions about how your community can prepare for these changes, or to learn more about our responsive, technology-driven HOA management services in Colorado, please reach out.
Brightstar Management Group
📍 9351 Grant Street, Ste 500, Thornton, CO 80229
📞 (303) 952-4004
✉️ hello@brightstarcolorado.com
🌐 www.brightstarhoa.com
