Texas House Bill HB3528

Texas 2017 - 85th Regular

Caption

Relating to the collection of past due assessments and certain other charges by a property owners' association.

Impact

If enacted, HB 3528 would significantly impact the operations of property owners' associations by establishing clearer regulations surrounding financial penalties and collection practices. Property owners would gain increased transparency and protection from arbitrary charges, particularly regarding the timing and type of fees that can be imposed. The requirement for associations to adopt reasonable payment plans aims to provide flexibility for homeowners facing financial difficulties, allowing them to manage their obligations without the threat of foreclosure unless absolutely warranted. This aligns with broader efforts to create fair and equitable treatment for property owners within their communities.

Summary

House Bill 3528 proposes amendments to the Texas Property Code regarding the collection of past due assessments and associated charges by property owners' associations. The bill seeks to clearly define the limits on late fees and the costs that can be imposed when collecting overdue assessments, ensuring that property owners are protected from excessive charges. Specifically, it sets a cap on late fees at 10% of the overdue amount and stipulates additional charges that may be incurred, such as attorney's fees not exceeding 25% of the past due assessment. The bill also mandates that an alternative payment plan be made available to homeowners without incurring additional penalties other than what is permissible under the new provisions.

Contention

While HB 3528 has been welcomed by many as a necessary reform, it has also faced scrutiny. Advocates argue that the new regulations could curb potential abuses by property owners' associations, especially where aggressive collection tactics have led to unforeseen financial strain on homeowners. However, some property management entities express concern over the potential loss of financial recourse in cases of chronic non-payment. The bill raises important discussions about balancing the rights and responsibilities of homeowners and property owners' associations, which could set a precedent for similar legislation in other states.