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A BILL TO BE ENTITLED
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AN ACT
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relating to foreclosure of a property owners' association's |
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assessment lien. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 209, Property Code, is amended by adding |
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Sections 209.0091 and 209.0092 to read as follows: |
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Sec. 209.0091. APPRAISAL AND MINIMUM SALE PRICE REQUIRED. |
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(a) Before a property owners' association files suit to foreclose |
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an assessment lien or initiates foreclosure of the lien under |
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Section 51.002, the association must: |
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(1) obtain and pay for an independent appraisal of the |
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fair market value of the property owner's property; and |
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(2) provide a copy of the appraisal to the property |
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owner by certified mail, return receipt requested, or by delivery |
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by the United States Postal Service with signature confirmation. |
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(b) Regardless of the amount of the lien, a property owners' |
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association may not conclude a judicial or nonjudicial foreclosure |
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sale of a property for which the property owners' association |
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obtained an appraisal under Subsection (a) unless the final sale |
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price at the foreclosure sale is at least 80 percent of the fair |
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market value as shown in the appraisal. |
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Sec. 209.0092. PRIORITY OF PAYMENTS AFTER FORECLOSURE. (a) |
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Proceeds received by a property owners' association at the |
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conclusion of a foreclosure sale of a property subject to an |
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assessment lien shall be applied in the following order of |
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priority: |
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(1) any delinquent assessment; |
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(2) any current assessment; |
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(3) any attorney's fees incurred by the association |
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associated solely with assessments or any other charge that could |
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provide the basis for foreclosure; |
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(4) any fines assessed by the association; |
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(5) any attorney's fees incurred by the association |
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that are not subject to Subdivision (3); and |
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(6) any other amount owed to the association. |
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(b) All proceeds from the foreclosure sale remaining after |
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the application of money in accordance with Subsection (a) shall be |
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paid to the property owner not later than the 60th day after the |
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date of the foreclosure sale. |
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SECTION 2. The change in law made by this Act applies only |
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to a foreclosure of a property owners' association assessment lien |
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for unpaid assessments all of which first become delinquent on or |
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after the effective date of this Act. Foreclosure of a property |
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owners' association assessment lien for assessments all or part of |
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which first became delinquent before the effective date of this Act |
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is governed by the law in effect immediately before the effective |
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date of this Act, and that law is continued in effect for that |
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purpose. |
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SECTION 3. This Act takes effect September 1, 2011. |