SRC-JEC S.B. 1834 77(R)   BILL ANALYSIS


Senate Research Center   S.B. 1834
By: Lindsay
Intergovernmental Relations
5/3/2001
As Filed


DIGEST AND PURPOSE 

Currently, property owners' associations have the authority to foreclose on
a homeowner's property if there are unpaid or late dues, fees, and fines.
The property is then sold for just enough to cover the dues, fees, or
fines, along with any attorney's fees or court costs.  As proposed, S.B.
1834 requires a property owners' association to reimburse a property owner
for the difference if it sells a foreclosed property for less than the
value of the property. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency.  

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 51, Property Code, by adding Section 51.008, as
follows: 

Sec. 51.008.  REIMBURSEMENT FOLLOWING FORECLOSURE OF LIEN FOR NONPAYMENT OF
ASSESSMENTS.  (a) Defines "assessment" and "property owners' association." 

(b) Provides that this section applies to a property owners' association
that forecloses a lien on real property to secure payment of assessments
due the association by the property owner. 

(c) Requires a property owners' association, if it authorizes the sale of
property for a price less than the value of the property according to the
most recent appraisal by the local appraisal district, to reimburse the
property owner for the difference between the sale price and the value
determined by the appraisal district. 

SECTION 2.  Provides that this Act applies to a foreclosure sale conducted
on or after January 1, 2001. 

SECTION 3.  Effective date: upon passage or September 1, 2001.