Bill reining in HOAs passes Texas Senate

A bill designed to give homeowners a more level playing field in dealing with homeowners associations passed the Texas Senate. Senate Bill 142, authored by Sen. Royce West (D-Dallas), permits homeowners to pay assessments levied by HOAs in installments, restricts how foreclosures are handled and requires HOAs to disclose operational documents to homebuyers at the time of a home sale, including organization bylaws and restrictions. On foreclosures, the bill requires that any foreclosures initiated by an HOA to be conducted through the courts. Texas is a nonjudicial state in which foreclosures initiated by mortgage servicers are not handled through the court system. An amendment added to the bill also prohibits homeowners associations from foreclosing on a member of the military on active duty, or for nine months after the active duty period ends. The bill passed the Senate unanimously and now goes to the House for consideration. Another HOA bill, S.B. 101, sponsored by Sen. Leticia Van de Putte (D-San Antonio), is designed to add protections to the Service Member’s Civil Relief Act, a federal law that protects active military personnel from foreclosure. That bill passed the Senate in late March and an identical companion bill in the House, H.B. 1397, is scheduled for a public hearing on Thursday. 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. The case spawned intense media scrutiny of homeowners associations and the power they wield to launch foreclosure actions for unpaid dues. Write to Kerry Curry. Follow her on Twitter @communicatorKLC.