05 May 2012

TEXAS LEGISLATURE PASSES NEW LAWS IMPACTING HOMEOWNERS’ ASSOCIATIONS

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Several new laws were recently passed by the Texas legislature regarding homeowners’ associations (HOAs).  The last of these provisions became law on January 1, 2012. While many HOAs serve a very good purpose – keeping our neighborhoods nice and home values where we want them, many Texas homeowners had been complaining publicly about widespread HOA abuses of power.

The highlights of the new laws include:

  • In order to foreclose on an assessment lien, an HOA must now obtain a court order.  Previously, this was not required.
  • Addition of foreclosure protections for active military personnel.
  • HOAs cannot foreclose on an owner for fines associated with records requests alone.
  • A restrictive covenant has no effect until it is filed with the appropriate county. Also requires that if an HOA has a website, it must include copies of all governing documents on the website.
  • HOAs may not prohibit residents from installing solar energy devices, and/or rain harvesting devices, but they can impose certain restrictions to comply with architectural guidelines.
  • A restrictive covenant can now be amended by a 67% membership vote, but it can be lower, if the HOAs declaration specifies so. Any vote by an HOA member must be conducted in writing and signed. Any rule preventing an owner from running for a position on the board is void.
  • Access to an HOAs books and records are now expanded. If an HOA cannot produce required records within 10 days of receiving a request, it must give the requestor a date within 15 business days by which the information will be available.
  • HOAs must now provide homeowners with written notice of their right to receive resale certificates. A buyer must pay fees for a resale certificate to the HOA unless the buyer and seller agree otherwise.
  • Homeowners now have an absolute right to fly U.S., Texas, or military flags absent adoption of HOA rules related to flag displays.
  • HOAs must permit homeowners to display religious items on the front door or doorframe unless the display contains obviously offensive language or images or is larger than 25 cumulative square inches.
  • Homeowners may now sue in local justice of the peace courts for remedies if the HOA does not produce records as requested.
  • HOAs must now apply payments received as follows– first, delinquent assessments; second, current assessments; third, attorney’s fees; fourth, fines; and fifth, other amounts owed.  HOAs must offer payment plans to delinquent homeowners with a three-month minimum repayment time.
  • HOA boards must have at least one-third control by residents, once the development is 75% built-out.

These new laws can be found in the Texas Property Code, Sections 202, 207, and 209, and are available online at www.statures.legis.state.tx.us/.

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