After a five-year battle with the homeowners association in her Lake Wylie neighborhood, Sherry Loeffler has won a rare victory: a legal settlement with the HOA.

Conflict Started in 2019When Loeffler submitted plans to install new vinyl windows on the townhouse on Lake Wylie, which the HOA of the Yachting Community approved.

He claims that the association reneged on its approval after the windows were installed. He ordered his windows to be changed at his own expense so that their appearance would best match those in society. He refused.

The HOA fined him nearly $12,000 and foreclosed on his home. Worried about the HOA foreclosing on her home, Loeffler filed a lawsuit.

The deal gives Loeffler $75,000 and she gets to keep her windows.

“It’s a huge weight off my shoulders,” said Loeffler, 53, who plans events and does other support work for banking executives. “I can’t even explain it.”

Still, Loeffler said the money had only just begun to cover what the war had cost her.

He said he had to borrow about $30,000 to cover legal fees and refinance his three-story townhouse at a significantly higher interest rate so he could save money to go to trial. (The case was settled just a week before it was scheduled to go to trial.)

She also said she had to start taking anxiety medication to cope with the stress of it all. In a letter filed with the court, Loeffler’s doctor said she suffered from panic attacks and trouble sleeping and that the conflict with her HOA was a major source of her stress.

Some people who had disagreements with their HOA turned to Loeffler for advice. He offers support, guidance and words of warning.

“I tell people you might want to fight them,” he said. “But let me tell you what it will cost.”

Conflicts with HOAs are increasingly common

HOAs are setting and enforcing rules in a growing number of neighborhoods. More than a quarter of North Carolinians now live in HOA communities, and many are happy with their associations. But legal experts say conflicts between residents and their HOAs appear to be on the rise.

HOAs in North Carolina have filed foreclosures against thousands of North Carolina homeowners — often for less than $2,000, 2023 Investigation by The Charlotte Observer and The News & Observer clarified. Newspapers revealed that hundreds of homeowners lost their homes as a result.

A. Bill that would prevent foreclosures of HOAs A bill addressing homeowners’ debts under $2,500 failed to gain momentum in the last legislative session, but lawmakers may revisit the issue next session.

No state or federal agency regulates HOAs, according to the North Carolina Department of Justice. Homeowners can sue associations, but this rarely happens because it is expensive.

Loeffler was an exception. She won the first round of her court battle last year, when Mecklenburg County District Court Judge Ty Hands ordered the HOA to lift the lien, cancel the fines and repay Loeffler the $12,675 she spent on legal fees. The HOA did not pay this money until this September.

In October, Loeffler’s HOA proposed a settlement agreement that included a confidentiality clause that would have prohibited her from publicly disclosing the terms of the settlement. This type of language is common in many legal settlements. However, this provision was removed from the agreement after Loeffler objected.

“People need to hear this story,” he said. “And a lesson needs to be learned that HOA boards shouldn’t do this to people and shouldn’t abuse their power. “I think they will think twice before doing this to others.”

The HOA said in previously filed court documents that neighbors complained that Loeffler’s windows “disrupted the building’s common plan” and that the building’s appearance had an impact on the community’s property values.

The association argued that the windows it installed did not match the plans it submitted. Judge Hands rejected that argument last year.

Charlie Anderson, who became HOA board president after the windows were installed, said board members years ago tried to negotiate a compromise that would have cost Loeffler nothing. He said Loeffler rejected the offer.

Now, he said, the community’s volunteer board members want to put the window legend behind them.

“We are not happy with the solution, but we want to continue,” he said. “…We just want to restore peace and harmony here and for this case to end. “This was very challenging for all board members involved.”

‘Put everything in writing’

Loeffler says one lesson for homeowners is that they need to document everything.

“When dealing with an HOA, put everything, every detail, no matter how small, in writing,” he said. “Because you don’t know when they will turn on you.”

In 2020, Loeffler’s HOA began fining her $100 a day for the windows; this is the maximum daily fine HOAs are allowed to impose under North Carolina law. The total soon rose to nearly $12,000. When the HOA placed a mortgage on her home for that amount, Loeffler filed suit, knowing the association could otherwise foreclose.

These types of lawsuits are not common because they are expensive for homeowners. Legal experts say HOAs generally worry less about litigation costs because they can use the association’s insurance or dues paid by property owners to cover their expenses.

Loeffler’s attorney said if the case holds a lesson for HOAs, they should think carefully before issuing large fines. Attorney Thomas Thurman said these sentences were undeserved in the Loeffler case.

“Setting daily fines against someone would quickly escalate and create lawsuit-worthy risks,” said Thurman, who represents both HOAs and homeowners in his Charlotte practice. “You don’t take this lightly.”

Why did the HOA fine Loeffler $100 a day? Anderson, the board chairman, said Loeffler did not respond to emails from board members trying to resolve the dispute and that “this was the board’s action to bring her to the table.”

Worn out by her ordeal, Loeffler said she now plans to move out. Where will he live next?

“It’s probably a community that doesn’t have an HOA,” he said.