By: Park H.B. No. 222
73R974 LJD-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to notice to subordinate lienholders of proposed
1-3 foreclosure or forfeiture under a superior deed of trust or
1-4 executory contract for conveyance.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 5.061, Property Code, is amended to read
1-7 as follows:
1-8 Sec. 5.061. Avoidance of Forfeiture and Acceleration. A
1-9 seller may enforce a forfeiture of interest and the acceleration of
1-10 the indebtedness of a purchaser in default under an executory
1-11 contract for conveyance of real property used or to be used as the
1-12 purchaser's residence only after notifying the purchaser, and each
1-13 subordinate lienholder requesting a copy of the notice in
1-14 accordance with Section 5.065, of the seller's intent to enforce
1-15 the forfeiture and acceleration and the expiration of the following
1-16 periods:
1-17 (1) if the purchaser has paid less than 10 percent of
1-18 the purchase price, 15 days after the date notice is given;
1-19 (2) if the purchaser has paid 10 percent or more but
1-20 less than 20 percent of the purchase price, 30 days after the date
1-21 notice is given; and
1-22 (3) if the purchaser has paid 20 percent or more of
1-23 the purchase price, 60 days after the date notice is given.
1-24 SECTION 2. Subchapter D, Chapter 5, Property Code, is
2-1 amended by adding Section 5.065 to read as follows:
2-2 Sec. 5.065. REQUEST FOR NOTICE OF FORFEITURE. (a) A person
2-3 holding a lien subordinate to a seller's interest in an executory
2-4 contract for conveyance may request a copy of any notice given by
2-5 the seller under Section 5.061. The subordinate lienholder must
2-6 file a written request for notice in the office of the county clerk
2-7 of each county in which the property is located. The request must
2-8 be on record in that office at least 10 days before the date the
2-9 seller gives notice under Section 5.061.
2-10 (b) The request for notice must:
2-11 (1) describe the executory contract for conveyance,
2-12 stating the date of its creation and its recording information, if
2-13 any, together with the names of the seller and purchaser;
2-14 (2) describe the property subject to the executory
2-15 contract for conveyance;
2-16 (3) describe the subordinate lien, stating the date of
2-17 its creation and its recording information, together with the name
2-18 of the subordinate lienholder requesting notice and the address of
2-19 the subordinate lienholder at which notice should be given; and
2-20 (4) be signed and acknowledged by the subordinate
2-21 lienholder.
2-22 (c) The county clerk shall record a request for notice under
2-23 this section in the same manner as an instrument concerning real
2-24 property.
2-25 (d) A request for notice filed under this section does not
2-26 affect title to the property.
2-27 (e) A seller must mail or deliver a copy of the notice to
3-1 the subordinate lienholder not later than one day after the date
3-2 notice is mailed or delivered to the purchaser.
3-3 SECTION 3. Section 51.002(b), Property Code, is amended to
3-4 read as follows:
3-5 (b) Notice of the sale, which must include a statement of
3-6 the earliest time at which the sale will occur, must be given at
3-7 least 21 days before the date of the sale:
3-8 (1) by posting at the courthouse door of each county
3-9 in which the property is located a written notice designating the
3-10 county in which the property will be sold;
3-11 (2) by filing in the office of the county clerk of
3-12 each county in which the property is located a copy of the notice
3-13 posted under Subdivision (1); and
3-14 (3) by the holder of the debt to which the power of
3-15 sale is related serving written notice of the sale by certified
3-16 mail on:
3-17 (A) each debtor who, according to the records of
3-18 the holder of the debt, is obligated to pay the debt; and
3-19 (B) each subordinate lienholder requesting
3-20 notice in accordance with Section 51.006.
3-21 SECTION 4. Chapter 51, Property Code, is amended by adding
3-22 Section 51.006 to read as follows:
3-23 Sec. 51.006. REQUEST FOR NOTICE OF SALE. (a) A person
3-24 holding a lien subordinate to a deed of trust or other contract
3-25 lien on property may request a copy of each notice posted by a
3-26 superior lienholder under Section 51.002(b)(1). The subordinate
3-27 lienholder must file a written request for notice in the office of
4-1 the county clerk of each county in which the property is located.
4-2 The request must be on record in that office at least 25 days
4-3 before the date of a scheduled sale.
4-4 (b) The request for notice must:
4-5 (1) describe the superior lien, stating the date of
4-6 its creation and its recording information, together with any named
4-7 grantor, trustee, and beneficiary, and include a description of the
4-8 property subject to the lien;
4-9 (2) describe the subordinate lien, stating the date of
4-10 its creation and its recording information, together with the name
4-11 of the subordinate lienholder requesting notice and the address of
4-12 the subordinate lienholder to which notice should be sent; and
4-13 (3) be signed and acknowledged by the subordinate
4-14 lienholder.
4-15 (c) The county clerk shall record a request for notice under
4-16 this section in the same manner as an instrument concerning real
4-17 property.
4-18 (d) A request for notice filed under this section does not
4-19 affect title to the property.
4-20 SECTION 5. This Act applies only to a foreclosure sale under
4-21 a deed of trust or other contract lien and to a forfeiture of
4-22 interest under an executory contract for the conveyance of real
4-23 property for which notice is sent to the holder of the debt or to
4-24 the purchaser after the effective date of this Act.
4-25 SECTION 6. The importance of this legislation and the
4-26 crowded condition of the calendars in both houses create an
4-27 emergency and an imperative public necessity that the
5-1 constitutional rule requiring bills to be read on three several
5-2 days in each house be suspended, and this rule is hereby suspended,
5-3 and that this Act take effect and be in force from and after its
5-4 passage, and it is so enacted.