The Nevada Supreme court has ruled that:
"NRS 116.3116 gives a homeowners' association (HOA) a
superpriority lien on an individual homeowner's property for up to nine
months of unpaid HOA dues. With limited exceptions, this lien is "prior to
all other liens and encumbrances" on the homeowner's property, even a
first deed of trust recorded before the dues became delinquent. NRS
116.3116(2). We must decide whether this is a true priority lien such that
its foreclosure extinguishes a first deed of trust on the property and, if so,
whether it can be foreclosed nonjudicially. We answer both questions in
the affirmative and therefore reverse."
The result is that an investment company bought a house for peanuts at an HOA foreclosure sale, and the sale wiped out the first mortgage on a house worth hundreds of thousands of dollars. Wow. I have placed the full opinion on mckenzie-law.wikispaces.com for anybody to download.