83R5846 SMH-F
By: Patrick S.B. No. 1201
A BILL TO BE ENTITLED
AN ACT
relating to ad valorem tax lien transfers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 32.06, Tax Code, is amended by amending
Subsections (a-1), (a-2), (a-4), (b-1), (f-4), and (j) and adding
Subsections (a-5) and (e-3) to read as follows:
(a-1) A person may authorize another person to pay the taxes
imposed by a taxing unit on the person's real property by filing
with the collector for the unit:
(1) a sworn document stating:
(A) the authorization;
(B) the name and street address of the transferee
authorized to pay the taxes of the property owner;
(C) a description of the property by street
address, if applicable, and legal description; [and]
(D) notice has been given to the property owner
that if the property owner is age 65 or disabled, the property owner
may be eligible for a tax deferral under Section 33.06;
(E) that the disclosure statement required by
Subsection (a-4)(1) has been provided to the property owner; and
(F) that the notice required by Subsection (b-1)
has been mailed by certified mail to any mortgage servicer and to
each holder of a recorded first lien encumbering the property; and
(2) the information required by Section 351.054,
Finance Code.
(a-2) A tax lien may be transferred to the person who pays
the taxes on behalf of the property owner under the authorization
for:
(1) taxes that are delinquent at the time of payment;
or
(2) taxes that are not delinquent at the time of
payment if:
(A) the property is not subject to a recorded
mortgage lien; and [or]
(B) a tax lien transfer authorized by the
property owner has been executed and recorded for one or more prior
years on the same property and the property owner has executed an
authorization consenting to a transfer of the tax liens for both the
taxes on the property that are not delinquent and taxes on the
property that are delinquent in the manner provided by Subsection
(a-1).
(a-4) The Finance Commission of Texas shall:
(1) prescribe the form and content of an appropriate
disclosure statement to be provided to a property owner not later
than the 12th day before the execution of a tax lien transfer;
(2) adopt rules relating to the reasonableness of
closing costs, fees, and other charges permitted under this
section; and
(3) by rule prescribe the form and content of the sworn
document under Subsection (a-1) and the certified statement under
Subsection (b).
(a-5) A transferee must include the following notice in at
least 12-point boldfaced type in any advertisement or solicitation
provided to a property owner by the transferee and in the disclosure
statement required by Subsection (a-4)(1): "WARNING: IF YOU HAVE A
MORTGAGE ON YOUR PROPERTY AND YOU TAKE OUT A PROPERTY TAX LIEN LOAN
WITHOUT THE CONSENT OF YOUR LENDER, YOU MAY BE IN DEFAULT AND YOUR
PROPERTY MAY BE SUBJECT TO FORECLOSURE."
(b-1) Not later than the 12th day before the date the
property owner files the sworn document required by Subsection
(a-1) with the collector for the taxing unit [10th business day
after the date the certified statement is received by the
transferee], the transferee shall send by certified mail [a copy of
the sworn document described by Subsection (a-1)] to any mortgage
servicer and to each holder of a recorded first lien encumbering the
property a notice that the property owner has requested that the
transferee pay the taxes on the property, that the tax lien will be
transferred to the transferee, and that the transferred tax lien
will be superior to the mortgage. The notice [copy] must be sent,
as applicable, to the address shown on the most recent payment
invoice, statement, or payment coupon provided by the mortgage
servicer to the property owner, or the address of the holder of a
recorded first lien as shown in the real property records.
(e-3) The transfer of a tax lien as provided by this section
does not affect the priority of the lien to the extent the lien
secures the funds advanced by the transferee to pay taxes,
penalties, interest, and collection costs as shown on the tax
receipt. The priority of a tax lien transferred as provided by this
section is determined by the date the lien and the statement
attesting to the transfer of the lien are recorded under Subsection
(d) to the extent the lien secures the funds advanced by the
transferee to pay closing costs, fees, and any other expenses
incurred by the transferee after the date the lien is transferred.
(f-4) Failure to comply with Subsection (b-1), (f), or (f-1)
does not invalidate a tax lien under this chapter, a contract lien,
or a deed of trust. However, in the event of such a failure, the
transferred tax lien is subordinate to any recorded preexisting
lien on the property. The relative priority of other liens on the
property is determined in accordance with the date they were
recorded.
(j) After one year from the date on which a tax lien
transferred as provided by this section is recorded in all counties
in which the property is located, the transferee of the lien may
foreclose the lien in the manner provided by Subsection (c) unless a
contract between the holder of the lien and the owner of the
property encumbered by the lien provides otherwise. Except as
provided by Subsection (e-3), the [The] proceeds of a sale
following a [judicial] foreclosure as provided by this subsection
shall be applied first to the payment of court costs, then to
payment of the judgment, including accrued interest, and then to
the payment of any attorney's fees fixed in the judgment. Any
remaining proceeds shall be paid to other holders of liens on the
property in the order of their priority and then to the person whose
property was sold at the tax sale.
SECTION 2. The change in law made by this Act applies only
to an ad valorem tax lien transferred on or after the effective date
of this Act. An ad valorem tax lien transferred before the
effective date of this Act is governed by the law in effect on the
date the tax lien was transferred, and the former law is continued
in effect for that purpose.
SECTION 3. This Act takes effect September 1, 2013.