Bill Text: TX HB2795 | 2013-2014 | 83rd Legislature | Engrossed

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Bill Title: Relating to enforcement of a lien against certain decedents' interests in real property.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Engrossed - Dead) 2013-05-17 - Committee report printed and distributed [HB2795 Detail]

Download: Texas-2013-HB2795-Engrossed.html

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83R22922 CLG-F
By: Raymond H.B. No. 2795

A BILL TO BE ENTITLED
AN ACT
relating to enforcement of a lien against certain decedents'
interests in real property.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 2, Estates Code, as effective
January 1, 2014, is amended by adding Chapter 125 to read as
follows:
CHAPTER 125. ENFORCEMENT OF LIEN AGAINST CERTAIN DECEDENTS'
INTERESTS IN REAL PROPERTY
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 125.001. DEFINITIONS. In this chapter, "mortgage
servicer," "mortgagee," "mortgagor," and "security instrument"
have the meanings assigned by Section 51.0001, Property Code.
Sec. 125.002. APPLICABILITY OF CHAPTER; CONFLICT WITH OTHER
LAW. (a) This chapter applies only to foreclosure of a lien on real
property of a decedent's estate if the decedent is the mortgagor of
the security instrument creating the lien.
(b) To the extent of a conflict between this chapter and
another provision of this title, Rule 736, Texas Rules of Civil
Procedure, or Chapter 51, Property Code, this chapter controls.
(c) Notwithstanding Section 22.004, Government Code, the
supreme court may not amend or adopt a rule in conflict with this
chapter.
SUBCHAPTER B. PROCEDURES PRIOR TO FORECLOSURE OF LIEN
Sec. 125.051. PROCEDURE IN ABSENCE OF PROBATE PROCEEDING.
(a) If a debt that is secured by a decedent's interest in real
property under a security instrument is in default and no probate
proceeding has been commenced, the mortgagee or mortgage servicer
may proceed with foreclosure of the lien on the property in
accordance with this section.
(b) Foreclosure of a lien on real property in accordance
with this section may not be initiated earlier than the 180th day
after the date of the decedent's death and may be initiated only if
the mortgagee agrees that the mortgagee has only a preferred debt
and lien claim against the decedent's interest in the real
property.
(c) The mortgagee or mortgage servicer, concurrently with
obtaining a judgment declaring heirship under Chapter 202, must:
(1) obtain a court order under Rule 736, Texas Rules of
Civil Procedure, allowing the mortgagee or mortgage servicer to
proceed with foreclosure of the lien under Chapter 51, Property
Code, and the terms of the security instrument; and
(2) give notice in accordance with Subchapter C.
(d) After a foreclosure sale following the procedure in
Subsection (c), the foreclosure deed divests all persons receiving
notice under Subchapter C of their right, title, and interest in the
decedent's interest in the real property.
SUBCHAPTER C. NOTICE AND OTHER REQUIREMENTS
Sec. 125.101. NOTICE. (a) For purposes of Section
51.002(b), Property Code, a mortgagee or mortgage servicer
foreclosing a lien under Section 125.051 must send notice of sale
to:
(1) each surviving obligor of the debt secured by the
real property or surviving mortgagor of the security instrument
encumbering the real property at the street address of the property
sought to be foreclosed and at any other address in the records of
the mortgagee or mortgage servicer identified by the decedent
mortgagor, surviving mortgagor, or surviving obligor as an address
for notice;
(2) the decedent, with the notation "Decedent," at the
street address of the property sought to be foreclosed;
(3) the surviving spouse of the mortgagor, if any;
(4) each heir of the decedent named in the judgment
obtained under Section 202.201, at the heir's last known address;
(5) the "Occupant" at the street address of the
property sought to be foreclosed; and
(6) if an heir is a minor child or otherwise under a
legal disability, the person who is the parent, natural guardian,
next friend, or person with a power of attorney for the heir or if a
guardianship has been created by a court for the heir, the name and
last known address of the heir's guardian of the estate.
(b) In addition to mailing the notice by certified mail as
required by Section 51.002(b), Property Code, the mortgagee or
mortgage servicer shall mail the notice by regular mail to the
person's last known address.
(c) If the name, last known address, or whereabouts of the
surviving spouse or an heir of a decedent or other person to whom
notice is required to be given under this section is unknown, the
mortgagee or mortgage servicer by affidavit shall describe to the
court the due diligence exercised by the person to find or locate
the whereabouts of the spouse, heir, or other person for purposes of
providing notice under this section and the court shall determine
whether citation by publication is necessary.
Sec. 125.102. CONTENTS OF APPLICATION FOR RULE 736 ORDER.
If a court order under Rule 736, Texas Rules of Civil Procedure, is
required under this chapter, the application for the order must:
(1) substantially comply with the requirements of Rule
736.1; and
(2) contain an estimate of the "fair market value" of
the property prepared not earlier than the 120th day before the date
the application is filed and supported by documentation as to fair
market value.
Sec. 125.103. CONTENTS OF ORDER. An order allowing the
mortgagee or mortgage servicer to proceed with the foreclosure of a
lien under this chapter must:
(1) describe the material facts establishing the basis
for foreclosure;
(2) describe the real property to be foreclosed by the
property's commonly known mailing address and legal description;
(3) contain the name and last known address of each
person who is to receive the notice under this subchapter; and
(4) contain the recording or indexing information of
the security instrument to be foreclosed.
SECTION 2. Chapter 125, Estates Code, as added by this Act,
applies only to the estate of a decedent who dies on or after the
effective date of this Act. The estate of a decedent who dies
before the effective date of this Act is governed by the law in
effect on the date of the decedent's death, and the former law is
continued in effect for that purpose.
SECTION 3. This Act takes effect January 1, 2014.