Can an HOA legally force online dues payments?

Started by AlfredR2 • 17 replies • 362 views

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AlfredR2 (Texas)
Posts: 1

Posted:

A member of the HOA in Montgomery County, TX has been paying dues monthly by paper check in the mail for 27 years, since before on line payments were possible.
In December 2024 the POA board has decided to force all members to now pay on line with no other option. Other HOAs in the area allow for paper check dues payments in the mail or otherwise like drop boxes. The member strongly rejects on line payments. The member refuses to pay on line and continues to pay by check monthly on time. The POA has those paper checks in their possession. But they are citing the member for non payment of dues.
Can the POA force the member to pay on line, or must the POA honor the paper checks already submitted, and continue to honor them in the future?
What does the HOA law and regulations say on this subject for Montgomery, TX?
Thanks for your input.

ElleN (Idaho)
Posts: 1,333

Posted:

Comments:

-- From my study and experience over some years, the most relevant law here is the law of contracts. Meaning: If your HOA's bylaws and declaration are silent as to how an owner must pay his/her assessment, then I do not like the HOA's chances in court of forcing payment using an online service.

-- Board-created rules have to be "reasonable" or else a court could refuse to enforce the rules. Is a board-created rule that payments must be made online "reasonable"? I would not want to test this in court.

-- Does the HOA board really want to spend the money on a HOA attorney's opinion (which most likely will not be dispositive anyway) here?

-- Citing the owner for nonpayment of dues could be defamation. Because in fact, this owner has paid his dues.

TimB4 (Tennessee)
Posts: 21,059

Posted:

To be honest, you will probably need to consult an attorney on this one, as legal action from you or defending a legal action by your HOA may be in the picture.

Do you know for a fact that the checks were received by the HOA?

DeanJ
Posts: 1,786

Posted:

Quote:

Posted By AlfredR2 on 10/24/2025 2:23 PM
A member of the HOA in Montgomery County, TX has been paying dues monthly by paper check in the mail for 27 years, since before on line payments were possible.
In December 2024 the POA board has decided to force all members to now pay on line with no other option. Other HOAs in the area allow for paper check dues payments in the mail or otherwise like drop boxes. The member strongly rejects on line payments. The member refuses to pay on line and continues to pay by check monthly on time. The POA has those paper checks in their possession. But they are citing the member for non payment of dues.
Can the POA force the member to pay on line, or must the POA honor the paper checks already submitted, and continue to honor them in the future?
What does the HOA law and regulations say on this subject for Montgomery, TX?
Thanks for your input.

I don’t understand the POAs position. I scan checks with my phone and deposit into my personal account. It’s not like it requires a lot of technology.

HOAs can and do establish service charges for various payment methods. As an example with my HOA, you may pay by check (which is scanned and electronically deposited by the PM) or online payments. Direct electronic transfers are free, debit and credit cards have service charges.

You are providing an additional service. I would simply establish a service charge for check payments.

ElleN (Idaho)
Posts: 1,333

Posted:

I think this is helpful:

https://www.hoaleader.com/public/CondosHOAs-Can-You-Require-ACH-Payments-Payments-Personal-Accounts-You-Didnt-Misread-That.cfm

DeanJ
Posts: 1,786

Posted:

Quote:

Posted By TimB4 on 10/24/2025 4:21 PM
To be honest, you will probably need to consult an attorney on this one, as legal action from you or defending a legal action by your HOA may be in the picture.

Do you know for a fact that the checks were received by the HOA?

Tim,

The one troublesome item is the POA accepted and retained the checks. If they were not accepting that form of payment, the checks should have been returned to the owner with a letter stating the POA was not accepting checks.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Dean,

We were told that they accepted and retained the checks.

Perhaps they went to an old management company?

This is why I asked the question, does the poster know for a fact that the checks were received and kept?

LetA (Nevada)
Posts: 2,679

Posted:

As others have stated unless expressly noted in the HOA's CC&R's The HOA must accept a paper hand written check as payment for
assessments. The problem lies with the PMC and the method they used to send check payments to the bank where HOA funds are held.

More often than not The bank is not in the same city or state as the HOA. Now someone has to mail the check via USPS or digitally
transmit the check to the bank. Does the PMC have such equipment to do so?

Many banks now offer free bill pay usually the homeowner would have to log in online or go to their bank branch for teller assistance.

Lastly the homeowner may be able to mail their check payment directly to the HOA's bank for assessment payment
provided the HOA can send the homeowner some sort of deposit slip that has the homeowners HOA account number and
the checking account number and routing number the bank can use to make the deposit by US Mail.

DeanJ
Posts: 1,786

Posted:

I a bit confused with the legal position, what for profit or not for profit corporation besides an HOA is required to accept personal checks as a form of payment?

SheliaH (Indiana)
Posts: 6,964

Posted:

I'm inclined to agree with Dean on a service charge for paper checks (something reasonable and homeowners should get a 60 day advance notice before charging it. That gives homeowners time to set up other payment arrangements. No charge if people take the check to the property managers office).

However, has this homeowner considered direct deposit? That's an option our community offers and you should be able to set that up through your own bank. I know some people prefer paper checks, but these days it's taking longer for things to get delivered, or mail can be lost or stolen. Threshold also bank by phone - have the homeowner look into that as well.

It may be this person is nervous about the online process and needs someone to walk him or her through it. If we're talking about an older person, I recently read an article that stated when older adults learn about the technology, they're more likely to use it. This person has paid by check for 27 years and it can be hard to change course.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

LetA (Nevada)
Posts: 2,679

Posted:

Quote:

Posted By DeanJ on 10/25/2025 8:53 PM
I a bit confused with the legal position, what for profit or not for profit corporation besides an HOA is required to accept personal checks as a form of payment?

With that said, they should be forced to accept cash, bitcoin even physical gold and silver.
Dispense with the service charges and other charges as it is the cost of doing business.
What happens if the charges and fees equal the amount of the assessment? Things would quickly get dicey.
Why should HOA's only chose banks that are not in the city where the HOA is and not do business with a local bank?
Go back to the old fashioned ledger and bank at a local bank.

ElleN (Idaho)
Posts: 1,333

Posted:

Quote:

Are you sure the law does not require most for profit and nonprofit corporations to accept checks?

DeanJ
Posts: 1,786

Posted:

Quote:

Posted By ElleN on 10/26/2025 6:28 PM

Are you sure the law does not require most for profit and nonprofit corporations to accept checks?

You are joking right? There are no laws that require businesses to accept personal checks. Can you pay for goods at Amazon with a personal check? You can’t even buy a beer at a college football game or an amusement park today with cash. Cards only.

ElleN (Idaho)
Posts: 1,333

Posted:

What I am most sure about is that you have not checked any state law as to whether HOA corporations can lawfully reject checks or charge a service fee for checks.

JulieH4
Posts: 75

Posted:

What the law says (Texas)

Texas HOA law that governs most subdivision HOAs is Chapter 209 of the Texas Property Code (the Texas Residential Property Owners Protection Act). That chapter sets procedural limits and homeowner protections about assessments, books & records, payment plans, and how payments are applied.

Texas Statutes

Payments received must be applied to the owner’s debt. Section 209.0063 establishes the priority and treatment of payments received by the association (how a payment is applied to delinquent assessments, current assessments, attorney’s fees, etc.). If the association has the owner’s check (i.e., the payment was received), it must apply that payment according to the statute and its usual accounting — it cannot treat a received payment as “not paid.”

HOAs must adopt reasonable guidelines for payment plans and collection, and there are owner protections for records and disputes. Section 209.0062 requires associations (over a certain size) to adopt reasonable guidelines for alternative payment schedules for delinquent amounts, and Section 209.005 gives owners rights to inspect and obtain association records (including financial records and collection records). Those record-access rules are useful if you need to prove checks were received/applied.

What the statute does not do: Chapter 209 does not give boards a blank check to ignore validly tendered payments or to retroactively declare previously-accepted payment methods invalid in a way that harms owners. Boards can adopt reasonable rules and policies.

They would have to change the by-laws in order to not take a check is what I am reading in the TX property code. I hope this person gets it figured out and make sure the checks were physically received.

JackS20 (North Carolina)
Posts: 269

Posted:

we are self managed. we get about 20 checks a year. This time I calculated how much time it took me to drive down and get them from the HOA mailbox 3 min down the street, open them all up, scan them into mobile deposit app then log into the software and credit each account. 2 freaking hours. I thought it would take 30 mins. I'm alwasy underestimating how long stuff takes. anyways moral of the story is we'll be implemting a very heft service fee for checks in the future. these people wnat to save $1.80 service fee so they pay by check but it's at my expense to piss 2 hrs of my personal time to enter them. $20 fee per check shounds reasonable to me because that what it would cost to hire accountant to add them manually. I know there will be pushback, but oh well.

JackS20 (North Carolina)
Posts: 269

Posted:

I've had "old" people they can't do stuff online and then they pay hoa dues online. It's a lie, people cna find a way to pay online with a relative or friend. it's 2025 for goodness sake.

Let them pay by check but charge a big service fee, suddendly they find a way guaranteed.

DeanJ
Posts: 1,786

Posted:

Quote:

Posted By LetA on 10/26/2025 6:07 PM

Go to Walmart and tell them you want to pay in good, silver or bitcoin and they have to accept it.

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