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A BILL TO BE ENTITLED
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AN ACT
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relating to notice to and rights of certain residential tenants of |
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premises purchased at a foreclosure sale. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 24.005, Property Code, is amended by |
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amending Subsection (b) and adding Subsections (b-1), (b-2), (b-3), |
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(b-4), and (b-5) to read as follows: |
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(b) Except as provided by Subsection (b-1), if [If] the |
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occupant is a tenant at will or by sufferance, the landlord must |
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give the tenant at least three days' written notice to vacate before |
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the landlord files a forcible detainer suit unless the parties have |
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contracted for a shorter or longer notice period in a written lease |
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or agreement. |
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(b-1) If a premises [building] is purchased at a judicial or |
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nonjudicial [tax] foreclosure sale [or a trustee's foreclosure
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sale] under a lien superior to a [the] tenant's lease and the tenant |
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is a bona fide residential tenant at will or by sufferance on the |
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date of the [timely pays rent and is not otherwise in default under
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the tenant's lease after] foreclosure, the purchaser must give the |
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[a residential] tenant [of the building] at least 90 [30] days' |
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written notice to vacate before filing a forcible detainer suit [if
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the purchaser chooses not to continue the lease. The tenant is
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considered to timely pay the rent under this subsection if, during
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the month of the foreclosure sale, the tenant pays the rent for that
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month to the landlord before receiving any notice that a
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foreclosure sale is scheduled during the month or pays the rent for
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that month to the foreclosing lienholder or the purchaser at
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foreclosure not later than the fifth day after the date of receipt
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of a written notice of the name and address of the purchaser that
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requests payment]. |
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(b-2) For purposes of this section, a residential tenant is |
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bona fide only if: |
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(1) the lease was the result of an arms-length |
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transaction; |
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(2) the lease requires receipt of rent that is not |
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substantially less than fair market rent for the premises; and |
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(3) the tenant is not the mortgagor of the purchaser at |
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the foreclosure sale or the child, spouse, or parent of the |
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mortgagor. |
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(b-3) A bona fide residential tenant of a premises purchased |
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at a judicial or nonjudicial foreclosure sale may occupy the |
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premises until the later of: |
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(1) the date provided by the notice to vacate under |
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Subsection (b-1); or |
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(2) the end of the remaining lease term. |
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(b-4) For purposes of Subsection (b-3), a bona fide |
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residential tenant may occupy the premises as described by |
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Subsection (b-3) only if the tenant: |
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(1) owes no delinquent or unpaid rent or other sums |
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owed to the landlord on the date of the foreclosure sale; and |
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(2) is a party to a lease agreement that is effective |
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on the date of the foreclosure sale. |
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(b-5) Before a foreclosure sale, a foreclosing lienholder |
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may give [written notice] to a tenant, including a residential |
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tenant at will or by sufferance or under a written lease or oral |
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rental agreement, written notice stating that a foreclosure notice |
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has been given to the landlord or owner of the property and |
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specifying the date of the foreclosure. |
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SECTION 2. The changes in law made by Section 24.005, |
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Property Code, as amended by this Act, apply only to the purchase of |
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property at a foreclosure sale on or after the effective date of |
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this Act. The purchase of property at a foreclosure sale before the |
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effective date of this Act is governed by the law as it existed |
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immediately before the effective date of this Act, and that law is |
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continued in effect for that purpose. |
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SECTION 3. This Act takes effect January 1, 2018. |