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A BILL TO BE ENTITLED
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AN ACT
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relating to payment of delinquent property owners' association |
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assessments and foreclosure of a property owners' association |
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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, 209.0092, and 209.0093 to read as follows: |
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Sec. 209.0091. ALTERNATIVE PAYMENT PLAN FOR DELINQUENT |
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ASSESSMENTS ON HOMESTEAD PROPERTY. (a) A property owners' |
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association shall adopt guidelines under which an owner who is |
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unable to pay a delinquent regular or special assessment in full on |
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property that is the owner's homestead may, at the owner's request, |
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make partial payments of the delinquent assessment until the |
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delinquency is cured. The association must allow an owner to submit |
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a request for a payment plan under this subsection for at least the |
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six-month period after the earliest date on which an unpaid |
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assessment on the property became delinquent. |
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(b) Guidelines adopted under Subsection (a) may provide for |
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the payment of a reasonable amount of interest on unpaid |
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assessments, not to exceed 10 percent interest annually. Interest |
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charged under this subsection may accrue from the time the |
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assessment becomes delinquent. |
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(c) This section does not require a property owners' |
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association to agree to a payment plan that: |
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(1) does not bind the owner to make at least one pro |
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rata payment monthly; or |
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(2) concludes later than 18 months after the earliest |
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date on which an unpaid assessment became delinquent. |
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Sec. 209.0092. PREREQUISITES TO FORECLOSURE ON HOMESTEAD. |
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(a) A property owners' association may not foreclose a property |
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owners' association assessment lien on property that is the owner's |
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homestead unless: |
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(1) an assessment secured by the lien is overdue by at |
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least six months and the owner has not requested a payment plan |
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under Section 209.0091 or a payment due under a payment plan is |
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overdue by at least three months; |
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(2) the total amount of delinquent assessments totals |
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at least $1,000; and |
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(3) before the expiration of the applicable period |
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prescribed by Subdivision (1), the property owners' association has |
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provided the owner at least two written notices of the delinquency, |
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sent at least 30 days apart, by certified mail, return receipt |
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requested, or by delivery by the United States Postal Service with |
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signature confirmation. |
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(b) A notice under Subsection (a) must: |
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(1) include an itemized list of each delinquent |
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assessment and state the total amount of the delinquent |
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assessments; |
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(2) inform the property owner that: |
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(A) the association is entitled to foreclose on |
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the owner's property for the unpaid assessments; and |
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(B) if the notice relates to a delinquency not |
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subject to a payment plan, the association must allow the owner to |
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enter into a payment plan arrangement if the owner requests the |
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arrangement on or before the date specified under Subdivision (3) |
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or, if the notice relates to a delinquency under a payment plan, the |
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association is entitled to foreclose if the delinquency is not |
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cured by the date specified under Subdivision (3); and |
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(3) specify the latest date on which the owner is |
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entitled to request a payment plan or cure a delinquency under a |
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payment plan, as applicable. |
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Sec. 209.0093. PROVISION OF ADDITIONAL SECURITY FOR |
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ASSESSMENTS ON HOMESTEAD. (a) A property owners' association shall |
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allow a property owner to provide the association with a security |
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interest in real or personal property other than the property that |
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is subject to the property owners' association assessments out of |
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which the association must seek satisfaction before foreclosing on |
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the property subject to the assessments if, at the time of the |
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foreclosure, the property subject to the assessments is the owner's |
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homestead. |
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(b) The association may not foreclose on homestead property |
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that is subject to assessments for which additional security has |
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been provided under this section unless the association has first |
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sought satisfaction out of the additional security and has not |
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recovered a sufficient amount to satisfy the debt secured by the |
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homestead property. |
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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. |