Kentucky's association landscape has changed significantly in recent years. The Kentucky Condominium Act modernized condo governance, and the 2023 Planned Community Act brought HOAs under a more structured framework for the first time. For board members in Louisville high-rises, Lexington townhouse communities, or lakeside associations across the Bluegrass, these changes affect how you handle delinquent assessments. Understanding the current rules—and which statute applies to your community—is the first step toward effective collection.

What Gets Funded

Kentucky association assessments pay for shared community needs:

  • Common area maintenance—landscaping, pool operations, clubhouse upkeep, parking facilities
  • Building infrastructure—elevators, fire systems, shared heating and cooling equipment, security systems
  • Utilities—common area electric and water, sometimes unit utilities
  • Property taxes—on common elements owned by the association
  • Insurance—the association's master policy
  • Reserve accounts—money set aside for roof replacement, paving, and other major expenses

Special assessments address bigger projects that exceed reserve funds. Kentucky's weather—hot, humid summers and cold winters that stress building systems—makes reserve funding and timely collection more than administrative tasks. They're what keeps communities from deteriorating.

Kentucky has multiple statutory frameworks, and which one governs your community matters:

Kentucky Condominium Act (KRS 381.9101–381.9207)

Applies to condos created after January 1, 2011. For older condos, it generally applies to events occurring after that date. Section 381.9193 covers assessment liens.

Planned Community Act (KRS 381.785–381.801)

Kentucky's 2023 HOA statute addresses budgets, records, assessments, liens, and board meetings. HOAs created before this act still rely primarily on their governing documents.

Horizontal Property Law (KRS 381.805–381.910)

Older condos created before 2011 may still fall under this law for some purposes, though the Condominium Act generally controls post-2011 events.

Under the Condominium Act, a lien arises automatically when an assessment comes due. Recording the original declaration provides notice—you don't need to record a separate lien for each delinquent owner.

What Your Lien Covers

Kentucky allows these components:

  • Unpaid assessments—regular and special
  • Late charges—as your documents authorize
  • Reasonable fines—imposed against owners for violations
  • Interest—capped at 18% annually under the Condominium Act
  • Collection costs and attorney's fees—incurred in enforcement
  • Recording and statement fees—administrative costs

Passing collection costs to the delinquent owner preserves association funds for community needs.

Priority Position

Kentucky's lien priority rules give associations meaningful but not unlimited leverage.

Under KRS 381.9193, a condo association's lien takes priority over most other liens with exceptions:

  • Liens recorded before the declaration was filed
  • Real estate tax liens and governmental assessments
  • Mortgages recorded before the assessment became delinquent

No Super-Lien in Kentucky

Unlike some states, Kentucky doesn't give associations priority over first mortgages. When a bank forecloses, the mortgage holder typically comes first. The association's lien beats most other creditors but not a properly recorded first mortgage.

This priority structure means delays can cost you. The longer assessments go unpaid, the more risk that a mortgage foreclosure or competing creditor complicates recovery.

Foreclosure in Kentucky

When an owner won't pay after demands and opportunities to cure, foreclosure becomes an option.

Judicial Foreclosure

KRS 381.9193 says the association's lien "may be foreclosed in like manner as a mortgage on real estate." In Kentucky, that means going through circuit court:

  • File a complaint initiating the foreclosure
  • The court oversees proceedings
  • A court-appointed commissioner conducts the public sale
  • You may be able to get a deficiency judgment if sale proceeds fall short

HOA Foreclosure

For homeowners associations, foreclosure authority depends on your governing documents. Most HOA declarations grant lien and foreclosure rights, but check yours. The judicial process is similar.

Courts expect proof that the association followed proper procedures—assessments were correctly levied, notices sent, owner given a chance to cure—before granting foreclosure.

Time Limits

Kentucky gives associations five years to enforce assessment liens. After that, the lien is extinguished.

Five years sounds like plenty of time, but delays create problems:

  • Larger balances become harder to collect
  • Owners may sell or file bankruptcy
  • Legal remedies get more complicated
  • Other owners shoulder the burden longer

Prompt, consistent collection protects your rights and treats all owners fairly.

Automatic Lien Protection

Kentucky condos get a procedural advantage: under KRS 381.9193(4), recording the declaration provides notice that assessment liens can arise. No separate lien filing required for each delinquent owner.

The lien exists automatically when assessments become due. This simplifies collection and reduces administrative costs.

Associations may still choose to record a notice of lien sometimes to:

  • Alert potential buyers
  • Put title companies on notice during sales
  • Strengthen position in collection efforts

Owner Rights

Opportunity to Cure

Owners can pay everything owed—assessments, late fees, interest, collection costs—to stop foreclosure before it concludes.

Payment Plan Negotiations

Owners often negotiate payment arrangements or reduced payoffs with associations. Many boards prefer a payment plan that brings an owner current over the expense and uncertainty of foreclosure.

Court Oversight

Because Kentucky requires judicial foreclosure, homeowners have court protection throughout. The judge ensures proper procedures before approving any sale.

Our Collection Approach

The Rickel Law Firm has been in operation since 1899. That history means we've adapted as laws change—including Kentucky's recent statutory updates.

Kentucky associations working with us get:

  • No cost to the association. Fees and collection costs go on the delinquent owner's account, not the association's budget.
  • Case visibility. ONYX, our online portal, gives board members and managers 24/7 access to case status, payment history, and progress.
  • We keep it professional. Delinquent owners are still your neighbors. We pursue collections in step with state laws while treating delinquent owners with respect— this produces better results and keeps community relationships intact.
  • Kentucky expertise. From the Condominium Act to the new Planned Community Act to older communities under the Horizontal Property Law, we know what applies and how to work within it.

Next Steps

Unpaid assessments create a cascade of problems. Responsible owners wind up subsidizing those who don't pay. Maintenance gets pushed back. Reserve contributions fall short. The community suffers.

If your Kentucky association has accounts that need professional collection, contact us for a free consultation. We'll explain the process and answer your questions. Don't use funding from people who pay on time to collect from people who don't!  Contact Rickel Law. 

Contact The Rickel Law Firm at 855.752.7156 or through our website.