By: Hilderbran H.B. No. 3842
 
Substitute the following for H.B. No. 3842:
 
  By:  Solomons C.S.H.B. No. 3842
 
A BILL TO BE ENTITLED
AN ACT
relating to the issuance of statements of ownership and location
for manufactured homes to certain lienholders without the consent
of the owners of those homes.
       BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
       SECTION 1.  Subchapter E, Chapter 1201, Occupations Code, is
amended by adding Section 1201.2077 to read as follows:
       Sec. 1201.2077.  ISSUANCE OF STATEMENT OF OWNERSHIP AND
LOCATION TO CERTAIN LIENHOLDERS WITHOUT OWNER'S CONSENT.  (a)  This
section applies only to a manufactured home:
             (1)  that is eligible for conversion from personal
property to real property under this subchapter;
             (2)  that, together with the real property to which the
home is attached, was intended to secure a first lien mortgage loan
that has gone into default and is now subject to foreclosure; and
             (3)  for which the person who made the first lien
mortgage loan and the borrower-owner, at the time of the making of
the mortgage loan executed documents that evidenced their mutual
intent for the owner-borrower to have converted the home to real
property and granted a first lien on that real property, including
the manufactured home, to secure that mortgage loan.
       (b)  A holder or servicer of a mortgage loan that seeks to
foreclose a first lien on a manufactured home described by
Subsection (a) that now seeks to foreclose such a lien may apply
without the consent of the borrower-owner for the issuance of a new
statement of ownership and location that reflects an intent to
convert the home from personal property to real property. An
application under this section must include an affidavit from the
holder or servicer making the application that:
             (1)  contains the election described by Section
1201.2055(a);
             (2)  states that it had been the intent of the
owner-borrower to convert the manufactured home to real property
and grant the maker of the mortgage loan a first lien on the
manufactured home, together with the real property to which it is
attached;
             (3)  states that the borrower-owner failed to convert
the manufactured home to real property;
             (4)  that the holder of the mortgage loan advanced loan
proceeds to or for the benefit of the owner of the manufactured home
in reliance on the owner's carrying out the conversion of the
manufactured home to real property and granting the holder a first
lien on that manufactured home together with the owner's interest
in the real property on which it is located; and,
             (5)  that the holder or servicer of the mortgage loan
giving the required affidavit has, despite reasonable efforts, been
unsuccessful in contacting the owner of the manufactured home to
have them re-execute and deliver the required documents to convert
the manufactured home to real property as originally contemplated.
       (c)  Not later than the 15th working day after the date of
receipt of the completed application and subject to Section
1201.2075, the department shall issue a new statement of ownership
and location reflecting that the manufactured home has been elected
as real property and the mortgage loan holder or servicer who
applied for this statement of ownership and location may make the
necessary filings and give the necessary notices to complete the
process of converting the manufactured home to real property as
provided in Section 1201.2055.
       SECTION 2.  This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution.  If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2007.