The HOA is the debtor
Claims are lodged against the entity, not automatically against residents.
The building is not HOA property
Roofs, lifts, stairs and other common property belong to unit owners.
Continuity matters
Owners should timely select management and a new special-account holder.
When an HOA may become bankrupt
An HOA is a nonprofit legal entity subject to general corporate bankruptcy rules. Under current Article 33 of Federal Law No. 127-FZ, a creditor petition ordinarily requires at least RUB 2 million and more than three months of default unless a special rule applies. Debt alone does not produce automatic bankruptcy; the court examines the established claim and insolvency evidence.
Property map
| Asset | Regime | Practical effect |
|---|---|---|
| HOA cash and property | May form the bankruptcy estate | Ownership and transactions are examined |
| Building common property | Owned by unit owners | Not sold as HOA property |
| Units | Owned individually | No automatic liability for HOA debts |
| Capital repair special account | Protected by Housing Code Article 175 | Excluded from the account holder’s estate |
| HOA receivables | Claims belonging to the HOA | May be collected for the estate |
Are unit owners liable?
Housing Code Article 135 states that the HOA answers with its own property, while it is not liable for members and members are not liable for the association. A creditor therefore cannot simply allocate the entity’s debt among apartments.
Owners retain their personal duties to pay housing, utilities and capital repair contributions. HOA bankruptcy neither discharges an owner’s arrears nor removes the building’s ongoing operating costs.
Capital repair account
Article 175 excludes special-account money from the account holder’s bankruptcy estate. Owners must choose a new account holder or another fund-formation method within the statutory period. Failure may trigger the local authority procedure specified by law.
Owner action plan
- Obtain the case number, court orders and Fedresurs notices.
- Reconcile management contracts, utilities and account balances.
- Separate HOA assets from building common property.
- Check the capital repair account and its holder.
- Hold a general meeting on management continuity.
- Transfer records to the new management body under an inventory.
See the general guide to corporate bankruptcy and the creditor petition against a company.
Frequently asked questions
Can the roof or lift be sold?
Not as HOA property: common property belongs jointly to the unit owners.
Do debts transfer to a new manager?
Not automatically. A new contract does not create universal succession for old HOA debts.
Must utilities still be paid?
Yes, but residents should verify the proper payee and current payment details.
What happens to the special account?
The funds are protected; owners must appoint a new holder or choose another statutory method.
Must the municipality pay HOA debts?
There is no automatic duty; any measure depends on specific powers, programmes and legal grounds.
Official sources
- Housing Code Article 135;
- Housing Code Article 36;
- Housing Code Article 161;
- Housing Code Article 175;
- Bankruptcy Law Article 33.
HOA insolvency problem?
We can separate assets, liabilities, the special account and owner decisions without promising a predetermined result.
Initial consultation