Blog Archives

Lenders Suddenly Say HOAs Are Unconstitutional

Welcome to the club … FINALLY!

So what caused this miraculous change of heart?  They are getting hit in the pocketbook.  Just like homeowners have been for years.

Now, all of a sudden, lenders are citing a constitutional problem with the way HOAs operate in the US.


A new ordinance in Chicago that requires lenders to pay maintenance costs for the upkeep of abandoned properties is under fire, with legal experts saying the ordinance violates lenders’ 14th Amendment right to equal protection, HousingWire reports.

Richard Gottlieb, chair of Dykema’s Financial Industry Group, says the Chicago ordinance is too broad and violates the rights of lenders by changing the code to include a mortgagee as a property owner, even though they aren’t the official owners of title.

You mean, like what HOAs have been doing to homeowners for years?  Changing the code to make themselves the owner of the property, even though they are not.

This is all very familiar.  I’ve been highlighting the unconstitutional behavior of HOAs for as long as I can remember.  HOAs themselves are not unconstitutional, their structure, power, and ability to seize property without due process is.

If HOAs solely existed to maintain common areas, as is constantly stated, there wouldn’t be a legal issue with them.  It’s their functioning as a government, taking property, and their ability to have people thrown in jail that is in violation of the US Constitution’s Bill of Attainder and the 14th Amendment’s due process clause.

Suddenly, the lenders get it, legal experts agree, and there is an actual legal fight over what I’ve been preaching for years.  No one has challenged HOA’s constitutionality in the courts before.  Now they are, and it’s as easy a case as you can get.