Texas 2015 - 84th Regular

Texas House Bill HB2069 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	84R6857 NC-F
2	2	By: Oliveira H.B. No. 2069
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the administration of foreclosure sales of real
8	8	property.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 1802.001, Occupations Code, is amended
11	11	by adding Subdivision (9-a) to read as follows:
12	12	(9-a) "Mortgage servicer," "mortgagee," "security
13	13	instrument," "substitute trustee," and "trustee" have the meanings
14	14	assigned by Section 51.0001, Property Code.
15	15	SECTION 2. Section 1802.002(a), Occupations Code, is
16	16	amended to read as follows:
17	17	(a) This chapter does not apply to:
18	18	(1) a sale conducted by order of a United States court
19	19	under Title 11, United States Code;
20	20	(2) a sale conducted by an employee of the United
21	21	States, this state, or a political subdivision of this state in the
22	22	course and scope of employment;
23	23	(3) a sale conducted by a charitable, religious, or
24	24	civic organization, including an organization having a tax exempt
25	25	status under Section 501(c), Internal Revenue Code of 1986, or
26	26	organized as a nonprofit entity, if the person organizing,
27	27	arranging, or conducting the auction receives no compensation;
28	28	(4) a sale conducted by any person of the person's
29	29	property if the person is not engaged in the business of selling
30	30	property at auction on a recurring basis;
31	31	(5) a foreclosure sale of real property personally
32	32	conducted by a trustee or substitute trustee under a security
33	33	instrument, if the trustee or substitute trustee:
34	34	(A) is an attorney or an employee of the
35	35	mortgagee or the mortgage servicer;
36	36	(B) has entered into a written agreement with an
37	37	attorney to administer and perform the functions of the trustee or
38	38	substitute trustee under the security instrument and Chapter 51,
39	39	Property Code, other than the advertising and conducting of the
40	40	auction; or
41	41	(C) is employed by an auction company to conduct
42	42	the auction, if the auction company has entered into a written
43	43	agreement with an attorney to administer and perform the functions
44	44	of the trustee or substitute trustee under the security instrument
45	45	and Chapter 51, Property Code, other than the advertising and
46	46	conducting of the auction [under a deed of trust];
47	47	(6) a foreclosure sale of personal property personally
48	48	conducted by:
49	49	(A) a person who holds a security interest in the
50	50	property, including a mortgage; or
51	51	(B) an employee or agent of a person described by
52	52	Paragraph (A) acting in the course and scope of employment, if:
53	53	(i) the employee or agent is not otherwise
54	54	engaged in the auction business; and
55	55	(ii) all property for sale in the auction is
56	56	subject to a security agreement;
57	57	(7) a sale conducted by sealed bid without the option
58	58	of increasing or decreasing the amount of a bid;
59	59	(8) an auction conducted only for student training
60	60	purposes as part of a course of study approved by the department;
61	61	(9) an auction conducted by a posted stockyard or
62	62	market agency as defined by the federal Packers and Stockyards Act
63	63	(7 U.S.C. Section 181 et seq.), as amended;
64	64	(10) an auction of livestock conducted by a nonprofit
65	65	livestock trade association chartered in this state, if the auction
66	66	involves only the sale of livestock owned by members of the trade
67	67	association;
68	68	(11) an auction conducted by a charitable or nonprofit
69	69	organization chartered in this state, if the auction:
70	70	(A) is part of a fair that is organized under
71	71	state, county, or municipal authority; and
72	72	(B) involves only the sale of property owned by
73	73	the organization's members; or
74	74	(12) a sale or auction conducted outside of this
75	75	state.
76	76	SECTION 3. Subtitle B, Title 5, Property Code, is amended by
77	77	adding Chapter 51A to read as follows:
78	78	CHAPTER 51A. FORECLOSURE SALES OF RESIDENTIAL REAL PROPERTY
79	79	Sec. 51A.001. DEFINITIONS. In this chapter:
80	80	(1) "Auction company" has the meaning assigned by
81	81	Section 1802.001, Occupations Code.
82	82	(2) "Mortgage servicer," "mortgagee," "security
83	83	instrument," "substitute trustee," and "trustee" have the meanings
84	84	assigned by Section 51.0001.
85	85	(3) "Proceeds of sale" means the sale price for a
86	86	property received at a foreclosure sale conducted by a trustee or
87	87	substitute trustee.
88	88	(4) "Residential real property" means:
89	89	(A) a single-family house;
90	90	(B) a duplex, triplex, or quadraplex; or
91	91	(C) a unit in a multi-unit residential structure
92	92	in which title to an individual unit is transferred to the owner of
93	93	the unit under a condominium or cooperative system.
94	94	Sec. 51A.002. APPLICABILITY. This chapter applies only to
95	95	a foreclosure sale of residential real property conducted under a
96	96	security instrument and Section 51.002.
97	97	Sec. 51A.003. ADMINISTRATION OF FORECLOSURE SALES. (a) A
98	98	foreclosure sale must be conducted by an individual who is a trustee
99	99	or substitute trustee authorized or appointed to exercise the power
100	100	of sale under a security instrument.
101	101	(b) Except as provided by Subsection (c), a trustee or
102	102	substitute trustee may enter into a written agreement with:
103	103	(1) an attorney to administer or perform any of the
104	104	trustee's or substitute trustee's functions or responsibilities
105	105	under a security instrument; or
106	106	(2) an auction company to arrange, manage, sponsor, or
107	107	advertise a foreclosure sale.
108	108	(c) A trustee or substitute trustee may not delegate the
109	109	performance of the public sale at auction of the property to any
110	110	person who is not a trustee or substitute trustee authorized or
111	111	appointed to exercise the power of sale under the security
112	112	instrument.
113	113	Sec. 51A.004. NOTICE OF SALE. The preparation and mailing
114	114	of a notice of sale required by Section 51.002 does not constitute
115	115	the practice of law.
116	116	Sec. 51A.005. INFORMATION FROM BIDDERS. (a) A trustee or
117	117	substitute trustee or an attorney or auction company that is
118	118	administering or managing a foreclosure sale at public auction may
119	119	request that bidders:
120	120	(1) register for the sale; or
121	121	(2) provide or display to the trustee, substitute
122	122	trustee, attorney, or auction company the following information:
123	123	(A) the name, address, telephone number, and
124	124	e-mail address of each individual tendering or who will tender the
125	125	sale price for a winning bid;
126	126	(B) if the bidder is acting on behalf of another
127	127	individual or organization, the name, address, telephone number,
128	128	and e-mail address of the individual or organization and the name of
129	129	a contact person for the organization;
130	130	(C) the name and address of any person to be
131	131	identified as the grantee in a trustee's or substitute trustee's
132	132	deed;
133	133	(D) for a winning bid, the purchaser's tax
134	134	identification number;
135	135	(E) a government-issued photo identification to
136	136	confirm the identity of each individual tendering funds for a
137	137	winning bid; and
138	138	(F) any other information reasonably needed to
139	139	complete the trustee's or substitute trustee's duties and functions
140	140	concerning the sale.
141	141	(b) A trustee, substitute trustee, attorney, or auction
142	142	company that requests a bidder to provide or display information
143	143	described by Subsection (a) before the sale may not refuse to allow
144	144	the bidder to bid if the bidder does not provide or display the
145	145	information before the sale.
146	146	(c) A trustee or substitute trustee may require a winning
147	147	bidder at a foreclosure sale to provide or display the information
148	148	described by Subsection (a) at the time the trustee or substitute
149	149	trustee completes the sale. If a bidder fails or refuses to provide
150	150	the information, the trustee or substitute trustee may:
151	151	(1) decline to complete the transaction;
152	152	(2) hold another auction; and
153	153	(3) sell the property to another bidder.
154	154	(d) Personal information obtained from a bidder in
155	155	connection with a foreclosure sale may not be sold or transferred by
156	156	a trustee, substitute trustee, attorney, or auction company without
157	157	the written informed consent of the bidder. The consent may not be
158	158	a condition of sale.
159	159	Sec. 51A.006. PURCHASER'S RECEIPT AND DEED. (a) After the
160	160	foreclosure sale, the trustee or substitute trustee shall:
161	161	(1) provide the winning bidder with:
162	162	(A) a purchaser's receipt for the proceeds of
163	163	sale; and
164	164	(B) a written copy of the conditions of sale
165	165	announced before bidding was opened for the first sale of the day
166	166	held by the trustee or substitute trustee; and
167	167	(2) except as provided by Subsection (b), within a
168	168	reasonable time:
169	169	(A) deliver the deed to the winning bidder; or
170	170	(B) file the deed for recording.
171	171	(b) If the foreclosure sale is disputed, the trustee or
172	172	substitute trustee may withhold the delivery or recording of the
173	173	deed while an action challenging the sale is pending in court.
174	174	Sec. 51A.007. PROCEEDS OF SALE. (a) Proceeds of sale
175	175	received in the form of checks or currency must be maintained in a
176	176	separate account until distributed to persons entitled to the
177	177	proceeds.
178	178	(b) The trustee or substitute trustee shall make reasonable
179	179	attempts to identify and locate the persons entitled to all or any
180	180	part of the proceeds of sale.
181	181	(c) A trustee or substitute trustee, or an attorney or
182	182	auction company acting under Section 51A.003, may make payments
183	183	from the proceeds of sale at any time.
184	184	(d) A person who accepts proceeds of sale tendered and
185	185	distributed by a trustee or substitute trustee takes the funds in
186	186	full satisfaction of claims for the proceeds of sale.
187	187	Sec. 51A.008. EXPENSES PAID FROM PROCEEDS OF SALE. (a) A
188	188	trustee or substitute trustee may be paid the trustee's or
189	189	substitute trustee's expenses for the sale from the proceeds of
190	190	sale, including:
191	191	(1) a trustee's or substitute trustee's fee of not more
192	192	than 2.5 percent of the proceeds of sale or the amount specified in
193	193	the security instrument;
194	194	(2) the actual costs of title evidence and records
195	195	searches incurred to identify parties legally entitled to the
196	196	proceeds of sale; and
197	197	(3) reasonable attorney's fees and costs incurred to
198	198	identify persons legally entitled to the proceeds of sale.
199	199	(b) A fee is:
200	200	(1) considered earned at the time of sale; and
201	201	(2) conclusively presumed to be reasonable if the fee:
202	202	(A) is not more than 2.5 percent of the proceeds
203	203	of sale, for a trustee's or substitute trustee's fee; or
204	204	(B) is not more than 1.5 percent of the proceeds
205	205	of sale, for an attorney's fee under Subsection (a)(3).
206	206	(c) A trustee or substitute trustee or an attorney who
207	207	prevails in a suit concerning a foreclosure sale of residential
208	208	real property conducted by the trustee or substitute trustee is
209	209	entitled to recover reasonable attorney's fees necessary to defend
210	210	the action, which may be paid from the excess proceeds of sale, if
211	211	any.
212	212	SECTION 4. (a) Section 1802.002, Occupations Code, as
213	213	amended by this Act, applies only to a foreclosure sale conducted on
214	214	or after the effective date of this Act. A foreclosure sale
215	215	conducted before the effective date of this Act is governed by the
216	216	law applicable to the foreclosure sale immediately before the
217	217	effective date of this Act, and that law is continued in effect for
218	218	that purpose.
219	219	(b) Chapter 51A, Property Code, as added by this Act,
220	220	applies only to a foreclosure sale for which the notice of sale is
221	221	given under Section 51.002, Property Code, on or after the
222	222	effective date of this Act.
223	223	SECTION 5. This Act takes effect September 1, 2015.