SB2833 - Relating to the nonjudicial foreclosure sale of certain residential real property.

  89R10426 RAL-D     By: Johnson S.B. No. 2833       A BILL TO BE ENTITLED   AN ACT   relating to the nonjudicial foreclosure sale of certain residential   real property.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Chapter 51, Property Code, is amended by adding   Section 51.0012 to read as follows:           Sec.   51.0012.     PROVISION TO THIRD PARTY OF NOTICE OF DEFAULT   OR NOTICE OF SALE. (a) In this section, "residential real   property" has the meaning assigned by Section 51.016.           (b)     A lender of a mortgage loan secured by residential real   property to be used as the borrower's residence shall provide   written notice to the borrower not later than the date the borrower   signs the security instrument that a third party designated by the   borrower may request to receive copies of any notice of default or   notice of sale provided to the borrower under Section 51.002,   including:                 (1)  a family member;                 (2)     a housing counseling agency approved by the United   States Department of Housing and Urban Development; and                 (3)  an attorney.          SECTION 2.  Chapter 51, Property Code, is amended by adding   Section 51.017 to read as follows:           Sec.   51.017.     NONJUDICIAL FORECLOSURE SALE OF CERTAIN   RESIDENTIAL REAL PROPERTY. (a) This section applies only to a   nonjudicial foreclosure sale of residential real property   conducted under Section 51.002. In this section, "residential real   property" has the meaning assigned by Section 51.016.           (b)     A mortgage servicer of a debt may not serve a debtor in   default under a deed of trust or other contract lien on residential   real property used as the debtor's residence with a notice of   default under Section 51.002(d) unless the mortgage servicer   provides the debtor with written notice by certified mail not later   than the 30th day before the date the mortgage servicer serves the   notice of default that informs the debtor that a third party   designated by the debtor may request to receive copies of any notice   of default or notice of sale provided to the debtor under Section   51.002, including:                 (1)  a family member;                 (2)     a housing counseling agency approved by the United   States Department of Housing and Urban Development; and                 (3)  an attorney.           (c)     At the time a mortgage servicer provides a notice of   default or notice of sale to the debtor under this section, the   mortgage servicer must provide a copy of the notice of default or   notice of sale to any person designated by the debtor in response to   a notice provided to the debtor under Subsection (b) or Section   51.0012 who makes a request to receive a copy of the notice of   default or notice of sale.           (d)     If, after receiving a notice of sale under Section   51.002(b), a debtor provides a trustee or substitute trustee by   certified mail a written listing agreement with a license holder   under Chapter 1101, Occupations Code, for the sale of the   residential real property not later than the fifth business day   before the date of sale specified in the notice of sale, the trustee   or substitute trustee shall postpone the foreclosure sale until at   least the 45th day after the scheduled date of sale. A second   notice of sale must be given not later than the 21st day before the   new date of sale in the same manner prescribed by Section 51.002(b).           (e)     If, after receiving the second notice of sale under   Subsection (d) and not later than the fifth business day before the   date of sale specified in the notice, a debtor provides a trustee or   substitute trustee by certified mail a copy of a signed purchase   agreement for the sale of the residential real property with a   purchase price amount equal to or greater than the unpaid balance of   the indebtedness secured by the property, the trustee or substitute   trustee shall postpone the foreclosure sale until at least the 45th   day after the date the trustee or substitute trustee receives the   purchase agreement. A final notice of sale must be given not later   than the 21st day before the new date of sale in the same manner   prescribed by Section 51.002(b).           (f)     A trustee or substitute trustee may not grant a   postponement of a foreclosure sale under Subsection (d) or (e) more   than once.           (g)     A mortgagee shall provide a valuation of the fair market   value of the residential real property to a trustee or substitute   trustee not later than 10 days before the initial date of sale   specified in a notice of sale provided under Section 51.002(b). The   trustee or substitute trustee may rely on the valuation provided by   the mortgagee without having to verify the source or accuracy of the   valuation. The valuation may not be made more than six months   before the date of the initial date of sale. The fair market value   may be determined by:                 (1)     an opinion of a license holder under Chapter 1101,   Occupations Code;                 (2)     an appraisal from a license holder under Chapter   1103, Occupations Code;                 (3)     a value from a commercially utilized automated   valuation model; or                 (4)     a value from a computerized property valuation   system that is used to derive a real property value.           (h)     A trustee or substitute trustee conducting a   foreclosure sale to which this section applies may not accept a bid   of less than 67 percent of the fair market value of the residential   real property, based on the valuation provided under Subsection   (g). If no party submits a bid in an amount equal to or greater than   67 percent of the fair market value of the residential real   property, the trustee or substitute trustee shall postpone the   foreclosure sale until not earlier than the seventh day after the   date of sale, after which a trustee or substitute trustee shall   conduct a second foreclosure sale and may accept a bid of less than   67 percent of the fair market value of the property.          SECTION 3.  Section 51.017, Property Code, as added by this   Act, applies only to a foreclosure action initiated by the   provision of a notice of default or notice of sale under Section   51.002, Property Code, on or after the effective date of this Act.          SECTION 4.  This Act takes effect September 1, 2025.