79R7651 JD-F
By: Puente H.B. No. 2491
A BILL TO BE ENTITLED
AN ACT
relating to the transfer of an ad valorem tax lien and to a contract
for foreclosure of an ad valorem tax lien.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 32.06, Tax Code, is amended by amending
Subsections (a), (b), and (e) and adding Subsections (j) and (k) to
read as follows:
(a) A person may authorize another person to pay the taxes
imposed by a taxing unit on the person's real or personal property
by filing with the collector for the unit a sworn document stating
the authorization, naming the other person authorized to pay the
taxes, and describing the property.
(b) If a person authorized to pay another's taxes pursuant
to Subsection (a) pays the taxes and any penalties and interest
imposed, the collector shall issue a tax receipt to the person
paying the taxes. In addition, the collector or a person designated
by the collector shall certify on the sworn document that payment of
the taxes and any penalties and interest on the described property
has been made by a person other than the person liable for the taxes
when imposed and that the taxing unit's tax lien is transferred to
the person paying the taxes. The collector shall attach to the
document the collector's seal of office or sign the document before
a notary public and deliver the document to the person paying the
taxes. The collector shall keep a record of all tax liens
transferred as provided by this section.
(e) A person holding a tax lien transferred as provided by
this section may not charge a greater rate of interest than 18
percent a year on the taxes, penalties, interest, closing costs,
and recording expenses paid to acquire and record the lien.
(j) A person who owns or holds a first lien on property sold
under this section is entitled to redeem the property from the
purchaser by paying the purchaser the foreclosure sale purchase
price plus costs, fees, and interest to the date of redemption at
the rate of 18 percent per year, or 125 percent of the purchase
price during the first year of the redemption period or 150 percent
of the purchase price during the second year of the redemption
period, whichever is less. The right of redemption may be exercised
on or before the second anniversary of the date on which the
purchaser's deed is filed of record if the property sold was the
residence homestead of the owner, was land designated for
agricultural use, or was a mineral interest. For any other
property, the right of redemption must be exercised not later than
the 180th day after the date on which the purchaser's deed is filed
of record.
(k) If a person redeems property under Subsection (j), the
purchaser at the foreclosure sale shall deliver a deed to the person
redeeming the property. If that person was the owner of the
property at the time of foreclosure, any lien existing on the
property at the time of the foreclosure sale remains in effect to
the extent not paid from the proceeds of the foreclosure sale.
SECTION 2. Section 32.065, Tax Code, is amended by amending
Subsections (a)-(c) and adding Subsections (g) and (h) to read as
follows:
(a) Section 32.06 does not abridge the right of an owner of
real property to enter into a contract for the payment of taxes to a
taxing unit and for the transfer of a tax lien from the taxing unit
in the manner provided by Sections 32.06(a)-(d) with [the holder of
a lien on the property, including] a transferee under Section 32.06
or this section. Section 32.06 does not authorize a claim to a tax
lien transferred under this section [,] or affect a contract
between the owner and holder of a lien for the payment of taxes on
the property.
(b) A contract entered into under Subsection (a) shall be
secured by a priority tax lien and may provide for:
(1) an event of default; [and]
(2) notice of acceleration;
(3) closing costs and fees;
(4) funding incident to an escrow agreement;
(5) interest at a rate not to exceed 18 percent on any
money advanced; and
(6) nonjudicial foreclosure sale.
(c) In addition to each right or remedy included in a
contract authorized by this section and notwithstanding
[Notwithstanding] any other provision of this code, a transferee of
a tax lien is subrogated to and is entitled to exercise any right or
remedy possessed by the transferring taxing unit, including or
related to foreclosure or judicial sale.
(g) A person who owns or holds a first lien on property sold
under this section is entitled to redeem the property from the
purchaser by paying the purchaser the foreclosure sale purchase
price plus costs, fees, and interest to the date of redemption at
the rate of 18 percent per year, or 125 percent of the purchase
price during the first year of the redemption period or 150 percent
of the purchase price during the second year of the redemption
period, whichever is less. The right of redemption may be exercised
on or before the second anniversary of the date on which the
purchaser's deed is filed of record if the property sold was the
residence homestead of the owner, was land designated for
agricultural use, or was a mineral interest. For any other
property, the right of redemption must be exercised not later than
the 180th day after the date on which the purchaser's deed is filed
of record.
(h) If a person redeems property under Subsection (g), the
purchaser at the foreclosure sale shall deliver a deed to the person
redeeming the property. If that person was the owner of the
property at the time of foreclosure, any lien existing on the
property at the time of the foreclosure sale remains in effect to
the extent not paid from the proceeds of the foreclosure sale.
SECTION 3. Sections 32.06(f) and (i), Tax Code, are
repealed.
SECTION 4. The changes in law made by this Act apply only to
the transfer of a tax lien that occurs on or after the effective
date of this Act or to a contract for the transfer of a tax lien
entered into on or after that date. The transfer of a tax lien that
occurred or a contract for the transfer of a tax lien that was
entered into before the effective date of this Act is covered by the
law in effect when the tax lien was transferred or the contract
entered into, and the former law is continued in effect for that
purpose.
SECTION 5. This Act takes effect September 1, 2005.