Texas HOA under 209 property code

Curious, has anyone ever heard of mortgage companies needing to approve if an HOA wants to change their governing documents to get them updated?

We have a board member under the impression that in order to update/change our governing documents, the mortgage companies need to sign off on this.

I know we should ask a lawyer, but they aren't open on Sunday and curious if anyone here in Texas under Property code 209 has heard of this.

Thank you.

I hope you are not in an absolute mess.

There are HOAs with declaration restrictions requiring lender approval for changes to the declaration. These are protections for the primary project lender from a developer materially changing the declaration while mortgages are held on unsold units. These provisions usually sunset when the development is under owner control or only apply to developer mortgages, but not always.

I would simply request your board member to identify the declaration section with this provision. If it is present and didn’t sunset, functionally it will extremely difficult to change your declaration because you are now dealing with numerous lenders and any single lender will be a veto simply by not participating. You likely would have to get owner cooperation to obtain the mortgage company information because mortgages today are sold, resold or refinanced quite regularly.