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A BILL TO BE ENTITLED
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AN ACT
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relating to ad valorem tax lien transfers. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 32.06, Tax Code, is amended by amending |
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Subsections (a-1), (a-2), (a-4), (b-1), (f-4), and (j) and adding |
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Subsections (a-5) and (e-3) to read as follows: |
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(a-1) A person may authorize another person to pay the taxes |
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imposed by a taxing unit on the person's real property by filing |
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with the collector for the unit: |
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(1) a sworn document stating: |
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(A) the authorization; |
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(B) the name and street address of the transferee |
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authorized to pay the taxes of the property owner; |
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(C) a description of the property by street |
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address, if applicable, and legal description; [and] |
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(D) notice has been given to the property owner |
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that if the property owner is age 65 or disabled, the property owner |
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may be eligible for a tax deferral under Section 33.06; |
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(E) that the disclosure statement required by |
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Subsection (a-4)(1) has been provided to the property owner; and |
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(F) that the notice required by Subsection (b-1) |
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has been mailed by certified mail to any mortgage servicer and to |
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each holder of a recorded first lien encumbering the property; and |
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(2) the information required by Section 351.054, |
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Finance Code. |
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(a-2) A tax lien may be transferred to the person who pays |
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the taxes on behalf of the property owner under the authorization |
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for: |
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(1) taxes that are delinquent at the time of payment; |
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or |
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(2) taxes that are not delinquent at the time of |
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payment if: |
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(A) the property is not subject to a recorded |
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mortgage lien; and [or] |
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(B) a tax lien transfer authorized by the |
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property owner has been executed and recorded for one or more prior |
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years on the same property and the property owner has executed an |
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authorization consenting to a transfer of the tax liens for both the |
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taxes on the property that are not delinquent and taxes on the |
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property that are delinquent in the manner provided by Subsection |
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(a-1). |
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(a-4) The Finance Commission of Texas shall: |
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(1) prescribe the form and content of an appropriate |
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disclosure statement to be provided to a property owner not later |
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than the 12th day before the execution of a tax lien transfer; |
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(2) adopt rules relating to the reasonableness of |
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closing costs, fees, and other charges permitted under this |
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section; and |
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(3) by rule prescribe the form and content of the sworn |
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document under Subsection (a-1) and the certified statement under |
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Subsection (b). |
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(a-5) A transferee must include the following notice in at |
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least 12-point boldfaced type in any advertisement or solicitation |
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provided to a property owner by the transferee and in the disclosure |
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statement required by Subsection (a-4)(1): "WARNING: IF YOU HAVE A |
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MORTGAGE ON YOUR PROPERTY AND YOU TAKE OUT A PROPERTY TAX LIEN LOAN |
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WITHOUT THE CONSENT OF YOUR LENDER, YOU MAY BE IN DEFAULT AND YOUR |
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PROPERTY MAY BE SUBJECT TO FORECLOSURE." |
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(b-1) Not later than the 12th day before the date the |
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property owner files the sworn document required by Subsection |
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(a-1) with the collector for the taxing unit [10th business day
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after the date the certified statement is received by the
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transferee], the transferee shall send by certified mail [a copy of
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the sworn document described by Subsection (a-1)] to any mortgage |
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servicer and to each holder of a recorded first lien encumbering the |
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property a notice that the property owner has requested that the |
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transferee pay the taxes on the property, that the tax lien will be |
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transferred to the transferee, and that the transferred tax lien |
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will be superior to the mortgage. The notice [copy] must be sent, |
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as applicable, to the address shown on the most recent payment |
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invoice, statement, or payment coupon provided by the mortgage |
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servicer to the property owner, or the address of the holder of a |
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recorded first lien as shown in the real property records. |
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(e-3) The transfer of a tax lien as provided by this section |
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does not affect the priority of the lien to the extent the lien |
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secures the funds advanced by the transferee to pay taxes, |
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penalties, interest, and collection costs as shown on the tax |
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receipt. The priority of a tax lien transferred as provided by this |
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section is determined by the date the lien and the statement |
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attesting to the transfer of the lien are recorded under Subsection |
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(d) to the extent the lien secures the funds advanced by the |
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transferee to pay closing costs, fees, and any other expenses |
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incurred by the transferee after the date the lien is transferred. |
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(f-4) Failure to comply with Subsection (b-1), (f), or (f-1) |
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does not invalidate a tax lien under this chapter, a contract lien, |
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or a deed of trust. However, in the event of such a failure, the |
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transferred tax lien is subordinate to any recorded preexisting |
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lien on the property. The relative priority of other liens on the |
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property is determined in accordance with the date they were |
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recorded. |
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(j) After one year from the date on which a tax lien |
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transferred as provided by this section is recorded in all counties |
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in which the property is located, the transferee of the lien may |
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foreclose the lien in the manner provided by Subsection (c) unless a |
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contract between the holder of the lien and the owner of the |
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property encumbered by the lien provides otherwise. Except as |
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provided by Subsection (e-3), the [The] proceeds of a sale |
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following a [judicial] foreclosure as provided by this subsection |
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shall be applied first to the payment of court costs, then to |
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payment of the judgment, including accrued interest, and then to |
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the payment of any attorney's fees fixed in the judgment. Any |
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remaining proceeds shall be paid to other holders of liens on the |
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property in the order of their priority and then to the person whose |
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property was sold at the tax sale. |
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SECTION 2. The change in law made by this Act applies only |
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to an ad valorem tax lien transferred on or after the effective date |
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of this Act. An ad valorem tax lien transferred before the |
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effective date of this Act is governed by the law in effect on the |
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date the tax lien was transferred, and the former law is continued |
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in effect for that purpose. |
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SECTION 3. This Act takes effect September 1, 2013. |