This week the Texas House committee on Business and Industry heard a bill relating to the priority of the debts incurred by homeowners in relation to delinquent payment of Homeowner Association dues and fines.
Supporters contend that HOA powers are repeatedly abused and the threat of foreclosure is used as a hammer to force homeowners to pay up.
Both the House and Senate version specify that assessments would be paid first in order to reduce the underlying debt. After that debt is settled, the HOA’s attorney fees and any other liability that could trigger foreclosure are paid. Finally, the fines and fees unrelated to the assessments or foreclosures would be settled before any other outstanding debt. By statutorily mandating the order of payment, homeowners are more quickly relieved from the threat of foreclosure.
Citing the special Election committees ruling that challenger Dan Neil did not meet the burden of proof, the Republican gave up his quest for House seat Dist. 48. The election was ultimately decided by a two vote margin. Thus, Republicans will have to live with a supermajority of only 101.
The Senate committee on Government Organization heard the Texas Department of Insurance Sunset bill this week.
At the hearing The Heartland Institute stressed the devastating effects of overregulation in Texas insurance markets. Consumers would best be served by allowing insurance companies to compete on a level playing field for their business. In order to accomplish this market freedom, the state must allow companies to announce their rates and use them immediately without interference from a government agency. Companies should be required to disclose only the information needed to determine their solvency and whether fraudulent activities s are taking place.
TDI’s functions should not include determination of “fair, nondiscriminatory, and excessive” rates. Rates should instead be based on risk. Individuals who take larger risks should pay more for their insurance. Likewise, responsible owners should pay less. Individuals can and should make informed choices as to the prices they pay for insurance and, so long as rates appear conscionable and are extended in a forthright manner, they should be regulated by the same market forces that govern the prices of everything. TDI’s ability to disapprove rates should be limited to ensuring the fair treatment of consumers and insuring fair competition in the marketplace.
Until next week,
Julie Drenner, Texas Director