The Faison family told ABC11 earlier this month that the cross is a symbol of hope and they would not take it down.
James Faison and his wife have lived in the Mulberry Park community for five years. This Christmas, they put up a six-foot cross in their yard.
'Mindboggling': 2 Wake County neighborhood covenants technically ban all races other than Caucasians
Neighborhood covenants technically ban races other than Caucasians
The HOA then sent the family a letter saying the cross is not considered a Christmas decoration -- but for Easter or Passover so it needed to be removed or the family would have to pay a $100 fine.
The board eventually backed down, but that wasn't until ABC11 contacted the HOA.
Now, the family attorney said they are planning to file a lawsuit in federal court.
"Something needs to be done once and for all," attorney Jeremy Morris told GMA. "Really to put a stop to what is becoming all too familiar to so many homeowners, and that is homeowners associations overstepping their bounds."
The HOA board told ABC News they recently sent the Faisons an email saying that their cross is now unconditionally approved.
The family attorney is seeking an apology and unspecified damages from the HOA.