Texas House Bill HB3077

Texas 2009 - 81st Regular

• Out of House Committee: 5/1/09

Caption

Relating to the assignment of security interests in certain collateral.

Impact

This bill is set to influence existing laws regarding the sale and assignment of security interests by amending the Business & Commerce Code, Occupations Code, and Transportation Code. By allowing lienholders greater flexibility in managing their security interests, HB 3077 hopes to facilitate business transactions involving collateralized assets and enhance the overall efficiency of the property market. The implications of these changes could assist lending practices and improve the fluidity of assets that are secured through liens, particularly in the real estate and motor vehicle markets.

Summary

House Bill 3077 addresses the assignment of security interests in various types of collateral, including manufactured homes, vessels, and motor vehicles. The bill enhances the ability of lienholders to assign their interests to third parties without jeopardizing the validity or perfection of such liens. The legislation clarifies that an assignment does not affect the owner's interests or the obligations of the original lienholder until the assignee is formally recorded as the new lienholder. This provision aims to streamline transactions involving secured property, making it simpler for lienholders to transfer their rights to new parties.

Contention

One point of contention surrounding HB 3077 is the balance between the rights of lienholders and the protection of property owners. Critics might argue that while it simplifies the assignment process for lienholders, it could potentially leave property owners vulnerable if they are not adequately informed of assignments. This concern warrants attention, particularly in scenarios where property owners are dealing with multiple lienholders or when transfers occur without their knowledge. Ensuring robust safeguards to protect the interests of owners against undisclosed assignments may be necessary to address these valid concerns.