Springfield Just Put a Condition on Every Association Collection Case
On July 31, 2026, the Governor signed Public Act 104-0734. It takes effect January 1, 2027.
The heart of it is one sentence, and if courts read it the way it is written, it is the most useful sentence for unit owners Illinois has passed in years. Starting January 1, 2027, an association or a holder or assignee of the association's debt "shall not take legal action to collect common expenses unless" it "has adopted, and follows, a written policy governing the collection of unpaid assessments."
The provision does two things. It tells the board it "must adopt policies and procedures concerning the collection of unpaid assessments." Then it separately bars the association from going to court unless it has adopted and follows one. The second obligation is what gives the first any weight.
The Act also dictates what the policy has to contain. Seven items, at a minimum, including how late fees and interest are calculated, when the board hands your account to a collection attorney, and how your payments get applied to your balance. Those last two are where most owners lose the most money.
Every situation is different and this article is not legal advice. Below is what the new law says, what it is worth if you are already in a collection fight, and the authority that will be used against you. You can read the bill in full on the Illinois General Assembly website.
First, Which Statute Governs You
The Act amends both Illinois community association statutes.
If you own a condominium, you are under the Condominium Property Act, 765 ILCS 605. Your new provision is Section 18.4(t), and the companion resale change is Section 22.1(a)(10).
If you own an attached or detached townhome, a villa, or a house in a covenanted community, you are probably under the Common Interest Community Association Act, 765 ILCS 160. Your new provision is Section 1-45(j), and the resale change is Section 1-35(d)(8).
The two versions read slightly differently, and the difference is not what it looks like. The condominium version applies "[n]otwithstanding any provision of the condominium instruments and adopted rules and regulations to the contrary." The community association version says only "[n]otwithstanding any provision in the community instruments to the contrary." That is not a weaker rule. Section 1-5 of the Common Interest Community Association Act already defines "community instruments" to include rules and regulations, while Section 2(l) of the Condominium Property Act defines "condominium instruments" as the declaration, bylaws, and plat only. Both provisions override the governing documents and the board's own rules.
Exemptions are a real difference. Section 1-75 of the Common Interest Community Association Act has two, and they are easy to confuse. Subsection (a) is the full exemption and requires a not-for-profit corporation with either 10 or fewer units or budgeted assessments of $100,000 or less a year. Subsection (b) is narrow and reaches only Section 1-30(a), parts of Section 1-40, and Section 1-55. Section 1-45 is not on that list, so an association qualifying only under subsection (b) still owes you a collection policy. The Condominium Property Act has no size exemption at all. A six-unit condominium carries the same duty as a lakefront high-rise.
If your development contains both condominium units and houses, confirm the classification first. A master association under Section 18.5 of the Condominium Property Act is excluded from the community association statute entirely, a trap we covered in Illinois' New Association Transparency Law.
The Seven Things the Policy Has to Say
The statute sets a floor. At a minimum, the written policy must specify:
(A) When assessments are due and when they are considered delinquent. Boards routinely treat an owner as delinquent on a schedule nobody wrote down. Now it has to be written down.
(B) Any late fees and interest the association is entitled to impose.
(C) Any returned check charges.
(D) The circumstances, if any, under which you are entitled to a payment plan, and the minimum terms of that plan. This is the first time Illinois law has required an association to say out loud whether payment plans exist. Read the qualifier honestly. "If any" means a board may write a policy offering none. What changes is that a board offering plans to some owners and not others now has a published standard sitting next to its own conduct.
(E) The amount or duration of time before the association refers a delinquent account to an attorney. The most consequential item on the list. Attorney fees are what turn a $900 arrearage into a five-figure lien.
(F) The method by which payments are applied to a delinquent account. If you have ever paid the current month's assessment and watched the association apply it to old attorney fees, leaving you permanently one month behind and permanently in default, this provision is aimed at you.
(G) The legal remedies available to the association under the governing documents and Illinois law.
Be precise about what these are. They are disclosure requirements. Nothing in the Act says an undisclosed charge is void, and nothing shifts a burden onto the association to justify a fee. The teeth are in the older provisions, and the policy is what lets you use them. Under Section 9(g)(1) of the Condominium Property Act, only attorney fees "incurred enforcing the covenants of the condominium instruments, rules and regulations of the board of managers, or any applicable statute or ordinance" become part of the lien. Section 9.2(c) bars management and other non-attorney collection fees from being passed to you unless the declaration authorizes them and a contract sets them. Section 9-111(b) of the Code of Civil Procedure requires the court to weigh the hours, the rate, and the amount in controversy before awarding fees. A published referral threshold gives you a date to measure all of that against.
Finally, the bar is not satisfied by paperwork alone. The entity must have "adopted, and follows," the policy. A board that ignores its own referral threshold, or applies your payments in a way its policy does not describe, has not met the condition. Neither has a board that adopts a policy the week after suing you. The Act also defines "entity" to include "a holder or assignee of the association's debt, whether the holder or assignee of the association's debt is an entity or a natural person," so a buyer of your delinquent account is bound by the same condition the association was.
What This Law Does Not Do
This is the part most articles will skip. Do not build a strategy on a tool that cannot carry the weight.
It is not in force yet. The Act takes effect January 1, 2027 and applies to conduct on and after that date. Whether it can be raised in a case already on file that day is an open question. The Act contains no savings clause.
The Act itself carries no penalty, fine, or fee award. Its only enforcement mechanism is the bar on taking legal action. And no Illinois court has construed it, so anyone who tells you how a Cook County judge will rule is guessing.
You probably cannot sue the association to enforce it. In Channon v. Westward Management, Inc., 2022 IL 128040, the Illinois Supreme Court declined to imply a private right of action under Section 22.1 of the Condominium Property Act, holding the bar "quite high" and reached only where a statute "would be ineffective, as a practical matter, unless a private right of action were implied." Channon turned on who the plaintiffs were. They were unit sellers, and the court held Section 22.1 was written to benefit buyers. A unit owner sits squarely inside the class Section 18.4(t) protects, so that reasoning does not transfer cleanly. The court's general caution does. The better view is that the prohibition itself is the remedy: your protection is the defense in the collection case, not a separate lawsuit.
The statute regulates when the association may sue, not whether the charge is valid. This is the honest weakness in the theory, and you should hear it from us rather than from opposing counsel. Illinois law is generous to defenses showing the money is not owed and stingy toward defenses showing the board misbehaved. On its face, a missing collection policy is closer to the second category.
Two First District cases will be cited against the defense. In North Spaulding Condominium Ass'n v. Cavanaugh, 2017 IL App (1st) 160870, the court held that an association need not prove, as part of its prima facie case, that it properly noticed and held an open board meeting and voted to authorize the suit. In Lake Point Tower Condominium Ass'n v. Waller, 2017 IL App (1st) 162072, the trial court dismissed a collection case with prejudice over a similar defect and the appellate court reversed, holding the association should have been given leave to amend. That is the practical risk. Even a defense that lands may buy delay rather than dismissal. Worth knowing too: the association in Lake Point Tower already had a rule sending any account 45 days past due to an attorney. The owner had exactly the written referral threshold this new law requires, litigated over it, and lost. A written policy is evidence, not a defense by itself.
Expect the business judgment rule. Boards invoke it in nearly every dispute. As stated in Feliciano v. Geneva Terrace Estates Homeowners Ass'n, 2014 IL App (1st) 130269, absent evidence of bad faith, fraud, illegality, or gross overreaching, courts will not interfere with the business judgment of corporate directors.
The subsection number is a mess. Public Act 104-0734 adds the collection policy as Section 18.4(t). A second 2026 law, Public Act 104-0797, adds the association website requirement as Section 18.4(t) as well. Two acts, same section, same letter, and no revisory act has fixed it. Under 5 ILCS 70/6, two acts of the same General Assembly amending the same section are read together and both take effect unless they make inconsistent changes to text that already existed. These do not, so both are law on January 1, 2027. Expect one to be relettered. When you write to your board, quote the language rather than relying on the letter.
Why the Argument Is Still Worth Making
The case against this statute is weaker than that list makes it look.
Start with what North Spaulding actually said. The court's reasoning was that the legislature had not imposed the requirement the owners wanted. In the court's words: "The legislature could have, but clearly did not, made the process of collecting necessary assessments more complicated by requiring formal proof of a collection duty in a forcible action."
As of January 1, 2027, the legislature has. North Spaulding rested on the absence of a statutory prerequisite. The prerequisite now exists, in express terms, and it is written as a prohibition on taking legal action rather than as a general duty of good governance. That is not a distinction we invented. It is the distinction the court itself drew. Note also that the owners in North Spaulding raised their argument for the first time in the middle of trial and never developed it. Raise this one in a responsive pleading.
Then look at the closest case on the books. In Board of Directors of Winnitt Park Condominium Ass'n v. Bourdage, 2021 IL App (1st) 192536, the First District affirmed a trial court that refused to evict an owner, on two independent grounds. First, the board levied a fine without giving the owner notice and an opportunity to be heard as Section 18.4(l) requires, so "the board did not properly impose the fine that served as the basis of the eviction action." Second, and directly on point here, the board never served the written demand that Section 9-104.1(a) of the Code of Civil Procedure requires. The court held the board "could not seek to evict Bourdage based on nonpayment of the fines in the January 31 order because the board did not issue a demand letter as required by the Forcible Entry and Detainer Act."
That second holding is the model. A statutory step the association had to take before suing, skipped, defeated the eviction as to those charges. That is structurally what Section 18.4(t) now requires. It also answers the business judgment rule. In Boucher v. 111 East Chestnut Condominium Ass'n, 2018 IL App (1st) 162233, the First District held that a board failing to give the notice Section 18.4(l) requires "did not meet even the minimal requirements" of that provision. Business judgment protects a board's choices. It does not excuse a statutory minimum.
The framing still has to be right. In Spanish Court Two Condominium Ass'n v. Carlson, 2014 IL 115342, the Illinois Supreme Court held that an association's failure to maintain the common elements is not a defense to an eviction for unpaid assessments. The same opinion leaves a door open: a unit owner "could, for example, challenge whether assessments are due by challenging the association's recordkeeping, or the manner in which the assessment was adopted." Under Section 9-106(f) of the Code of Civil Procedure, matters "not germane to the distinctive purpose of the proceeding" cannot be raised in an eviction case. The argument that survives is not "the board behaved badly." It is that the association had no lawful footing to bring this case, or that these charges were never lawfully imposed.
On the cure problem, the statute wrote its own answer. Lake Point Tower let an association amend after a governance defect. This provision is harder to repair that way, because it requires that the entity have "adopted, and follows" the policy. A policy written in response to a motion was not followed when the fees accrued, when the account went to counsel, or when your payments were applied. The owner in Lake Point Tower also cited no authority against ratification, so the point was never squarely decided.
Condominium owners have one further argument, and it is an argument rather than a settled remedy. Section 18.4 closes by providing that its provisions apply to all condominium instruments recorded under the Act, that any contrary portion of an instrument is "void as against public policy and ineffective," and that an instrument failing to contain the required provisions "shall be deemed to incorporate such provisions by operation of law." The argument is that this pulls the collection policy duty into your declaration, converting a statutory duty into a contractual one. Treat it as untested. Section 18.4(t) directs the board rather than prescribing a term for the instrument, and Section 19(h) carries nearly identical language without any court reading an owner remedy into it. Community association owners do not have even this much, because Section 1-45 has no equivalent paragraph.
One structural note. Every collection case above is an eviction case, subject to the germaneness limit in Section 9-106(f). That limit does not apply to a lien foreclosure filed in chancery, where the available defenses are broader. The association chooses which remedy to file, so this is not a choice a unit owner gets to make. It is still worth knowing which door you came through.
What Unit Owners Should Do Between Now and January
Ask for the policy in writing, and ask now. A short letter to the board and the management company asking whether a written collection policy has been adopted, and requesting a copy, gets you the document and dates the board's answer. Ask that the response appear in the minutes.
Watch the board's meeting notices this fall. The Act adds no notice requirement, no deadline for adoption, and no duty to send owners a copy. But you are not without notice. Section 18(a)(9) of the Condominium Property Act already requires that board meetings be open to unit owners, that votes be taken at an open meeting, and that notice of every board meeting be posted in entranceways, elevators, or other conspicuous places at least 48 hours ahead. If you want input on the payment plan terms or the attorney referral threshold, that is where it happens.
If you are selling, use the resale packet. After January 1, 2027, the Section 22.1 disclosure package a condominium seller is entitled to must include the collection policy. The board has 10 business days from a written request, and the fee is capped at $375, adjusted annually for inflation since 2024, plus up to $100 for rush service within 72 hours. On the community association side, Section 1-35(d) gives the board 30 days and sets no dollar figure, but limits the charge to a reasonable fee covering the direct out-of-pocket cost of copying and providing the information.
If you are not selling, use a records request. For condominiums, Section 19(a)(2) covers rules and regulations and Section 19(a)(4) covers minutes for the preceding seven years. Ask for the policy and the minutes of the meeting adopting it. The board has 10 business days, silence counts as a denial, and an owner who prevails on those categories recovers reasonable attorney fees and costs. One caution: the Act added the policy to Section 22.1 and left Section 19 alone, so a board may argue a collection policy is not a "rule." The adopting minutes are not open to that argument, so ask for both. For community associations, Section 1-30(i) expressly reaches rules and regulations adopted by the board, gives the board 30 days, and requires both prevailing and a court finding that the failure was due to the acts or omissions of the board before fees are available.
If you are already in collections, pull your ledger now. Get your full account history before January. What the association has been doing with your payments is the fact you will want to hold up against whatever policy it eventually adopts.
And if you are facing a large assessment, that clock is separate and short. When adopted assessments would exceed 115% of the prior year, owners may petition to force an owners' meeting. It is not a veto. Unless a majority of all the votes in the association are cast at that meeting to reject the budget or assessment, it is ratified. Condominium owners get 21 days to deliver the petition, community association members get 14, and the board must call the meeting within 30 days. We walk through it in How to Challenge an HOA Special Assessment in Illinois.
One Thing You Should Not Do: Stop Paying
If your board has no collection policy, the temptation is to withhold assessments until it produces one. Do not.
The new provision limits when the association can go to court. It does not suspend your obligation to pay, and it does not stop the debt from growing. Unpaid assessments still become a lien on your unit under Section 9(g), still pick up interest, late charges, and attorney fees, and still expose you to foreclosure and to an eviction action in which the association takes possession of your unit and may rent it out to satisfy the debt under Section 9-111.1. You keep title. The court must stay enforcement of an eviction order for at least 60 days, and you can move to vacate the order once you pay the amounts the court finds due, costs, and fees, provided you are current going forward and the unit is not already leased out. We explain how far that process goes in Can My HOA Foreclose on My Condo in Illinois?
Spanish Court is clear that a general complaint about how the board is run does not excuse the assessment. Pay, state in writing that you are paying under protest if you have a dispute, and fight the collection practices through the channels built for that.
Talk to Us Before the Fees Stack Up
The value of this law to a unit owner is almost entirely in the record built before the association files anything. A dated request for the policy, a ledger pulled before the board wrote one, and a fee history that predates the board's own referral threshold are cheap to gather now and nearly impossible to reconstruct after a judgment.
Our office represents unit owners, never boards, in HOA and condo disputes across Chicago and the collar counties. If you have received a demand letter, a notice of lien, or court papers, the deadlines are short. Contact The Law Office of Krista Krepp at contact@krepplaw.com or schedule a consultation online. If your board is stonewalling on records or financials, the claims that grow out of a documented record are covered in Do You Have a Claim Against Your HOA?
Frequently Asked Questions
When does this take effect? January 1, 2027. Public Act 104-0734 was signed July 31, 2026, but it sets no earlier date, so the default rule in the Effective Date of Laws Act supplies January 1 of the following year.
If my association has no collection policy, can it still sue me? Before January 1, 2027, yes. On and after that date, the statute says the association "shall not take legal action to collect common expenses" without having adopted and followed a written policy. Whether an Illinois court will treat that as a defense that defeats a collection case has not been decided, and there is meaningful authority an association will use to argue otherwise. Do not treat it as a guarantee, and do not raise it without counsel.
Can the board just adopt a policy after it sues me and fix the problem? That is the association's best argument, and Lake Point Tower Condominium Ass'n v. Waller, 2017 IL App (1st) 162072, gives it support: the appellate court there reversed a dismissal with prejudice and held the association should have been allowed to amend. The counterargument is the statute's own wording. It requires the entity to have "adopted, and follows" the policy. A policy written after the fact was not followed when the fees were incurred or the account was referred to an attorney.
Does the association have to send me the collection policy? No. The Act requires the board to adopt one and to include it in the resale disclosure package. It does not require the board to distribute it to current owners or to post it. Ask in writing, and request the adopting minutes through a records request under Section 19 for condominiums or Section 1-30(i) for community associations.
Does this apply to a debt collector or debt buyer who bought my account? Yes, if it holds or was assigned the debt. The Act covers "a holder or assignee of the association's debt, whether the holder or assignee of the association's debt is an entity or a natural person." A collection agency working for the association without an assignment is not covered by that language, but the association itself remains bound.
My HOA is small. Are we exempt? Probably not. The narrower exemption in Section 1-75(b) does not reach Section 1-45, so it does not excuse the collection policy. Only the full exemption in Section 1-75(a) does, and it requires a not-for-profit corporation with either 10 or fewer units or annual budgeted assessments of $100,000 or less. Condominiums have no size exemption at all.
Can I stop paying assessments until my board adopts a policy? No. The statute restricts when the association may go to court. It does not suspend your payment obligation or stop interest, late charges, and attorney fees from accruing on your account.