1-1  By:  Uher (Senate Sponsor - Brown)                     H.B. No. 333
    1-2        (In the Senate - Received from the House April 27, 1995;
    1-3  May 1, 1995, read first time and referred to Committee on
    1-4  Jurisprudence; May 16, 1995, reported favorably by the following
    1-5  vote:  Yeas 7, Nays 0; May 16, 1995, sent to printer.)
    1-6                         A BILL TO BE ENTITLED
    1-7                                AN ACT
    1-8  relating to authorizing a deed-of-trust foreclosure after accepting
    1-9  a deed in lieu of foreclosure.
   1-10        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
   1-11        SECTION 1.  Chapter 51, Property Code, is amended by adding
   1-12  Section 51.006 to read as follows:
   1-13        Sec. 51.006.  DEED-OF-TRUST FORECLOSURE AFTER DEED IN LIEU OF
   1-14  FORECLOSURE.  (a)  This section applies to a holder of a debt under
   1-15  a deed of trust who accepts from the debtor a deed conveying real
   1-16  property subject to the deed of trust in satisfaction of the debt.
   1-17        (b)  The holder of a debt may void a deed conveying real
   1-18  property in satisfaction of the debt before the fourth anniversary
   1-19  of the date the deed is executed and foreclosed under the original
   1-20  deed of trust if:
   1-21              (1)  the debtor fails to disclose to the holder of the
   1-22  debt a lien or other encumbrance on the property before executing
   1-23  the deed conveying the property to the holder of the debt in
   1-24  satisfaction of the debt; and
   1-25              (2)  the holder of the debt has no personal knowledge
   1-26  of the undisclosed lien or encumbrance on the property.
   1-27        (c)  A third party may conclusively rely upon the affidavit
   1-28  of the holder of a debt stating that the holder has voided the deed
   1-29  as provided in this section.
   1-30        (d)  If the holder elects to void a deed in lieu of
   1-31  foreclosure as provided in this section, the priority of its deed
   1-32  of trust shall not be affected or impaired by the execution of the
   1-33  deed in lieu of foreclosure.
   1-34        (e)  If a holder accepts a deed in lieu of foreclosure, the
   1-35  holder may foreclose its deed of trust as provided in said deed of
   1-36  trust without electing to void the deed.  The priority of such deed
   1-37  of trust shall not be affected or impaired by the deed in lieu of
   1-38  foreclosure.
   1-39        SECTION 2.  This Act applies only to a holder of a debt who
   1-40  accepts a deed conveying property in satisfaction of a debt on or
   1-41  after the effective date of this Act.
   1-42        SECTION 3.  The importance of this legislation and the
   1-43  crowded condition of the calendars in both houses create an
   1-44  emergency and an imperative public necessity that the
   1-45  constitutional rule requiring bills to be read on three several
   1-46  days in each house be suspended, and this rule is hereby suspended.
   1-47                               * * * * *