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Senate Bill 247 |
Senate Author: Carona et al. |
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Effective: 5-29-13 |
House Sponsor: Miller, Doug et al. |
Current law prohibits a property tax lender from charging any fee, other than interest, after closing in connection with the transfer of a property tax lien unless the fee is expressly authorized or from charging any interest that is not expressly authorized under certain Tax Code provisions relating to the transfer of a tax lien. Senate Bill 247 amends the Finance Code to also apply that prohibition to any successor in interest.
Senate Bill 247 prohibits a property owner from waiving or limiting a requirement imposed on a property tax lender by the Property Tax Lender License Act, except as specifically permitted by certain state law. The bill sets out restrictions and requirements concerning the solicitation and advertisement of property tax loans, authorizes the Finance Commission of Texas to adopt rules to implement those provisions, and authorizes the consumer credit commissioner to assess an administrative penalty against a property tax lender who violates those provisions, regardless of whether the violation is knowing or wilful.
Senate Bill 247 prohibits a person from selling, transferring, assigning, or releasing rights related to a property tax loan to a person who is not licensed under the Property Tax Lender License Act or who is exempt from those licensing requirements. The bill requires the finance commission to adopt rules to implement that prohibition.
Senate Bill 247 exempts from the Property Tax Lender License Act an individual who is related to the property owner within the second degree of consanguinity or affinity, rather than an individual who makes a property tax loan from the individual's own funds to a spouse, former spouse, or persons in the lineal line of consanguinity of the individual lending the money.
Senate Bill 247 amends the Tax Code to revise the procedures for authorizing another person to pay the taxes imposed on real property and the procedures for transferring a property tax lien. Among other provisions, the bill limits the conditions under which the transfer of a tax lien is authorized with regard to taxes that are not delinquent at the time of payment and prohibits a person who is 65 years of age or older from authorizing a transfer of a tax lien on real property on which the person is eligible to claim a $10,000 residence homestead exemption for purposes of school district taxes. The bill authorizes a lender with an existing recorded lien on property to request a payoff statement before the tax loan becomes delinquent. The bill requires the finance commission by rule to prescribe the form and content of the lender's request and the transferee's response to the request. A transferee who receives a request for a payoff statement is required to deliver the statement within a period prescribed by finance commission rule.
Senate Bill 247 prohibits a tax lien from being transferred to the person who pays the taxes on behalf of the property owner if the real property has been financed with a grant or below market rate loan provided by a governmental program or nonprofit organization and is subject to the covenants of the grant or loan or if the real property owner is encumbered by a municipality's lien against property with a dangerous structure. The bill authorizes the finance commission to adopt rules to implement this prohibition.
Senate Bill 247 specifies that a property owner cannot waive or limit any requirement imposed on a transferee, except as specifically provided by provisions relating to the transfer of a tax lien. The bill also removes certain recording and notice requirements that apply to a contract between a transferee and a property owner for the payment of taxes that is secured by a priority lien on the property.