Texas foreclosure laws

Texas foreclosures are carried out both in court and out of court. It is easier and quicker to foreclose on real estate in Texas than most other states. The Texas Foreclosure process can take as few as three months. The initial process period is about 27 days, and there is no redemption period.

 

 

• How are mortgage liens treated in Texas?
• How are Texas Foreclosures handled?
• How long does Texas Foreclosure take?
• What statutes apply to Texas Foreclosure?

How are mortgage liens treated in Texas?

Texas is a "title theory" state which requires the property in foreclosure to remain in trust until payment in full is made on the loan. The property is secured by either a Mortgage or Deed of Trust.

 

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How are Texas Foreclosures handled?

Pre-foreclosure

When no power-of-sale clause is included in the mortgage or Deed of Trust, the foreclosure is administered by the court.

• The lender immediately files a lawsuit against the borrower to obtain court order to foreclose on the property.
  
  
• Once the court declares foreclosure, the property is scheduled for public sale.

A power of sale clause is included with most foreclosures allowing the foreclosure to be conducted without a lawsuit being filed, or court involvement. Non-judicial (out-of-court) foreclosures are more common in Texas.

• The lender must first mail a default letter to the borrow allowing at least 20 for payment of the default amount on the loan.
  
  
• After the 20 days (above) expires, the lender may start the foreclosure process. The lender then sends the borrow a loan acceleration letter indicating that the full balance of the loan is due and that a sale has been scheduled to recover the full amount due.

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Notice of Sale / Auction

The lender posts a notice of sale at the door of the county courthouse and files a foreclosure notice with the Dallas Country Clerk 21 days prior to the foreclosure sale.

• The lender also mails a copy of the notice to the borrower at the last known address 21 days prior to the sale.
• In Texas, no public notice of sale is required in the local newspaper.
• Texas Foreclosure sales are from 10 a.m. and 4 p.m. on the first Tuesday of the month (regardless of holidays)
• Texas Foreclosure sales are usually conducted on the Dallas County Courthouse steps.
• The Foreclosure Sale is conducted as a public auction.
• The property is awarded to the highest-bidder.
• The winning bidder must pay cash for the property.
• Anyone may bid on the property, including the lender
• The lender bids by canceling out the balance due on the note.
• The property is sold free of any junior liens, but subject to senior liens.
• If the bid amount is higher than the lender's stake, the surplus goes to junior lienholders.
• There is no Borrower's Right of Redemption for Texas Foreclosures.
• Deficiency judgments may be granted to the lender, but are limited to the difference between the fair market value of the property at the time of sale and the balance of the loan in default.

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How long does the Texas Foreclosure take?

 

A Texas non-contested, judicial Foreclosure process takes roughly 60 days. This process can be delayed if the borrower files bankruptcy, contests the suit or seeks delays.

 

Learn more about Texas Foreclosure Law

 

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What statutes apply to Texas Foreclosure?

Texas foreclosures are found in Title 5, Section 51 of Texas Property Code.

 

 

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Why Specialized Realty for buying Foreclosures?

• Our firm specializes in Texas foreclosure properties.
• Our agents are foreclosure experts.
• Our foreclosure focus experience helps us to keep you from potential penalties.
• Our foreclosure expertise ensures a smooth process for our buyers.
• Our experience in working with foreclosures helps you avoid any unforeseen penalties.
• We can make you aware of foreclosures before they go on the market.
• SRG buyer's agents represent the buyer, not the seller.
• We offer a market analysis to assist with negotiations.
• We have connections with lenders and mortgage who know foreclosures best.
• We work with foreclosures on a daily basis, so we know when a "hot deal" comes up.
• We offer foreclosures throughout North Texas.
• We have connections with lender and mortgage providers with hands-on experience working with foreclosures.

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