Though they are legally nonprofit corporations and yet de facto private governments, they often assume the powers of both without either's checks and balances. That power reaches far beyond the ability to dictate door color and fence height. Associations are governed by elected boards, which enforce a set of governing documents that homeowners agree to when they move in. Also, it's common for those homeowners to agree to nonjudicial foreclosure. That means the association doesn't need a hearing or a judge to sell a resident's house to collect fines and legal fees.
Associations can also tax residents to finance lawsuits.
Members must pay or face fines, lawsuits, or, ultimately, foreclosure. She recently helped a Houston man avoid losing his house to foreclosure. The foreclosure has since been voided. People move into planned communities, attracted by the tidy appearance but failing to realize that they will be held to the same tight standards. There are ways to avoid unpleasant surprises, says Joni Greenwalt, the self-styled Ann Landers of the homeowner movement.