Texas bill to prevent HOA foreclosures on active military passes committee
A state bill that would prevent homeowners associations from foreclosing on active military personnel has made it out of a Texas Senate committee. Senate Bill 101 was passed unanimously by the senators in the intergovernmental relations committee and now awaits a vote before the full Senate, expected in the coming weeks. An identical companion bill in the House, H.B. 1397, written by Rep. Joe Farias (D-San Antonio), has been referred to the House Defense and Veterans Affairs Committee. Texas — and homeowners associations — got a black eye last year when a Dallas-area HOA foreclosed on Mike Clauer while the Army National Guard captain was serving in Iraq. The foreclosure — for a $300,000 home that was fully paid for — was to settle a debt of about $3,500 in overdue HOA fees, according to media reports at the time. Clauer's wife learned of the foreclosure after the home had already been sold on the courthouse steps, according to news reports. The couple eventually got the house back. The case spawned intense media scrutiny of homeowners associations and the power they wield to launch foreclosure actions for unpaid dues. S.B. 101, sponsored by Sen. Leticia Van de Putte (D-San Antonio), is designed to add l protections to the Service Member's Civil Relief Act, a federal law that is supposed to protect active military personnel from foreclosure. In the case of Clauer, the HOA didn't know Clauer was serving in the military, according to a bill analysis by the Senate Research Center. That communication breakdown resulted in the home being put into foreclosure, according to the analysis. S.B. 101 amends two portions of the state's property code to require the servicer of debt to recognize military service and comply with the federal SCRA. Also under the bill, notices of HOA debts will now have to carry "a statement that is conspicuous, printed in boldface or underlined type" that notifies homeowners that active military (or their spouses) should send written notice of the active service to the debt servicer immediately. If passed by both Houses, the bill will take effect on Sept. 1. A separate bill by Rob Orr (R-Burleson) takes things a step further, but was left pending in a House committee. Under HB 366, a homeowners association would be prohibited from foreclosing on an assessed lien if the debt to the HOA consists solely of fines by the association and attorney’s fees incurred associated with the assessed fines. It would have applied to all homeowners, not just active military. Write to Kerry Curry. Follow her on Twitter @communicatorKLC.