Question about legality of condo association "rules"

[Tim R.]

My mother-in-law has a commercial retail rental property that is part of an association. The property is currently in her name and she has no encumbrances on the property. I suggested that she do something to either leverage the property or transfer it to an LLC, trust, series LLC or something of the like so the property is not a target for people who would try to take out a lawsuit against her.

With that being said, she is telling me that the condo association bylaws state that there can be no mortgages on the properties in the business complex where she owns the rental. Is this someone blowing smoke or is this something that is legally permitted?