Texas Laws - Property Code
PROPERTY CODE
TITLE 5. EXEMPT PROPERTY AND LIENS

TITLE 5. EXEMPT PROPERTY AND LIENS (2337)(1-click HTML)

SUBTITLE A. PROPERTY EXEMPT FROM CREDITORS' CLAIMS (2338)(1-click HTML)

CHAPTER 41. INTERESTS IN LAND (2339)(1-click HTML)
SUBCHAPTER A. EXEMPTIONS IN LAND DEFINED (2340)(1-click HTML)
Sec. 41.001. INTERESTS IN LAND EXEMPT FROM SEIZURE. (2341)(1-click HTML)

(a) A homestead and one or more lots used for a place of burial of the dead are exempt from seizure for the claims of creditors except for encumbrances properly fixed on homestead property. (2342)

(b) Encumbrances may be properly fixed on homestead property for: (2343)

(1) purchase money; (2344)

(2) taxes on the property; (2345)

(3) work and material used in constructing improvements on the property if contracted for in writing as provided by Sections 53.254(a), (b), and (c); (2346)

(4) an owelty of partition imposed against the entirety of the property by a court order or by a written agreement of the parties to the partition, including a debt of one spouse in favor of the other spouse resulting from a division or an award of a family homestead in a divorce proceeding; (2347)

(5) the refinance of a lien against a homestead, including a federal tax lien resulting from the tax debt of both spouses, if the homestead is a family homestead, or from the tax debt of the owner; (2348)

(6) an extension of credit that meets the requirements of Section 50(a)(6), Article XVI, Texas Constitution; or (2349)

(7) a reverse mortgage that meets the requirements of Sections 50(k)-(p), Article XVI, Texas Constitution. (2350)

(c) The homestead claimant's proceeds of a sale of a homestead are not subject to seizure for a creditor's claim for six months after the date of sale. (2351)

Amended by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985; Acts 1993, 73rd Leg., ch. 48, Sec. 2, eff. Sept. 1, 1993; Acts 1995, 74th Leg., ch. 121, Sec. 1.01, eff. May 17, 1995; Acts 1995, 74th Leg., ch. 121, Sec. 2.01; Acts 1997, 75th Leg., ch. 526, Sec. 1, eff. Sept. 1, 1997; Acts 2001, 77th Leg., ch. 516, Sec. 1, eff. Sept. 1, 2001. (2352)

Sec. 41.002. DEFINITION OF HOMESTEAD. (2353)(1-click HTML)

(a) If used for the purposes of an urban home or as both an urban home and a place to exercise a calling or business, the homestead of a family or a single, adult person, not otherwise entitled to a homestead, shall consist of not more than 10 acres of land which may be in one or more contiguous lots, together with any improvements thereon. (2354)

(b) If used for the purposes of a rural home, the homestead shall consist of: (2355)

(1) for a family, not more than 200 acres, which may be in one or more parcels, with the improvements thereon; or (2356)

(2) for a single, adult person, not otherwise entitled to a homestead, not more than 100 acres, which may be in one or more parcels, with the improvements thereon. (2357)

(c) A homestead is considered to be urban if, at the time the designation is made, the property is: (2358)

(1) located within the limits of a municipality or its extraterritorial jurisdiction or a platted subdivision; and (2359)

(2) served by police protection, paid or volunteer fire protection, and at least three of the following services provided by a municipality or under contract to a municipality: (2360)

(A) electric; (2361)

(B) natural gas; (2362)

(C) sewer; (2363)

(D) storm sewer; and (2364)

(E) water. (2365)

(d) The definition of a homestead as provided in this section applies to all homesteads in this state whenever created. (2366)

Amended by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985; Acts 1989, 71st Leg., ch. 391, Sec. 2, eff. Aug. 28, 1989; Acts 1999, 76th Leg., ch. 1510, Sec. 1, eff. Jan. 1, 2000; Acts 1999, 76th Leg., ch. 1510, Sec. 2, eff. Sept. 1, 1999. (2367)

Sec. 41.0021. HOMESTEAD IN QUALIFYING TRUST. (2368)(1-click HTML)

(a) In this section, "qualifying trust" means an express trust: (2369)

(1) in which the instrument or court order creating the express trust provides that a settlor or beneficiary of the trust has the right to: (2370)

(A) revoke the trust without the consent of another person; (2371)

(B) exercise an inter vivos general power of appointment over the property that qualifies for the homestead exemption; or (2372)

(C) use and occupy the residential property as the settlor's or beneficiary's principal residence at no cost to the settlor or beneficiary, other than payment of taxes and other costs and expenses specified in the instrument or court order: (2373)

(i) for the life of the settlor or beneficiary; (2374)

(ii) for the shorter of the life of the settlor or beneficiary or a term of years specified in the instrument or court order; or (2375)

(iii) until the date the trust is revoked or terminated by an instrument or court order recorded in the real property records of the county in which the property is located and that describes the property with sufficient certainty to identify the property; and (2376)

(2) the trustee of which acquires the property in an instrument of title or under a court order that: (2377)

(A) describes the property with sufficient certainty to identify the property and the interest acquired; and (2378)

(B) is recorded in the real property records of the county in which the property is located. (2379)

(b) Property that a settlor or beneficiary occupies and uses in a manner described by this subchapter and in which the settlor or beneficiary owns a beneficial interest through a qualifying trust is considered the homestead of the settlor or beneficiary under Section 50, Article XVI, Texas Constitution, and Section 41.001. (2380)

(c) A married person who transfers property to the trustee of a qualifying trust must comply with the requirements relating to the joinder of the person's spouse as provided by Chapter 5, Family Code. (2381)

(d) A trustee may sell, convey, or encumber property transferred as described by Subsection (c) without the joinder of either spouse unless expressly prohibited by the instrument or court order creating the trust. (2382)

(e) This section does not affect the rights of a surviving spouse or surviving children under Section 52, Article XVI, Texas Constitution, or Part 3, Chapter VIII, Texas Probate Code. (2383)

Added by Acts 2009, 81st Leg., R.S., Ch. 984 (H.B. 3767), Sec. 1, eff. September 1, 2009. (2384)

Sec. 41.003. TEMPORARY RENTING OF A HOMESTEAD. (2385)(1-click HTML)

Temporary renting of a homestead does not change its homestead character if the homestead claimant has not acquired another homestead. (2386)

Amended by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985. (2387)

Sec. 41.004. ABANDONMENT OF A HOMESTEAD. (2388)(1-click HTML)

If a homestead claimant is married, a homestead cannot be abandoned without the consent of the claimant's spouse. (2389)

Added by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985. (2390)

Sec. 41.005. VOLUNTARY DESIGNATION OF HOMESTEAD. (2391)(1-click HTML)

(a) If a rural homestead of a family is part of one or more parcels containing a total of more than 200 acres, the head of the family and, if married, that person's spouse may voluntarily designate not more than 200 acres of the property as the homestead. If a rural homestead of a single adult person, not otherwise entitled to a homestead, is part of one or more parcels containing a total of more than 100 acres, the person may voluntarily designate not more than 100 acres of the property as the homestead. (2392)

(b) If an urban homestead of a family, or an urban homestead of a single adult person not otherwise entitled to a homestead, is part of one or more contiguous lots containing a total of more than 10 acres, the head of the family and, if married, that person's spouse or the single adult person, as applicable, may voluntarily designate not more than 10 acres of the property as the homestead. (2393)

(c) Except as provided by Subsection (e) or Subchapter B, to designate property as a homestead, a person or persons, as applicable, must make the designation in an instrument that is signed and acknowledged or proved in the manner required for the recording of other instruments. The person or persons must file the designation with the county clerk of the county in which all or part of the property is located. The clerk shall record the designation in the county deed records. The designation must contain: (2394)

(1) a description sufficient to identify the property designated; (2395)

(2) a statement by the person or persons who executed the instrument that the property is designated as the homestead of the person's family or as the homestead of a single adult person not otherwise entitled to a homestead; (2396)

(3) the name of the current record title holder of the property; and (2397)

(4) for a rural homestead, the number of acres designated and, if there is more than one survey, the number of acres in each. (2398)

(d) A person or persons, as applicable, may change the boundaries of a homestead designated under Subsection (c) by executing and recording an instrument in the manner required for a voluntary designation under that subsection. A change under this subsection does not impair rights acquired by a party before the change. (2399)

(e) Except as otherwise provided by this subsection, property on which a person receives an exemption from taxation under Section 11.43, Tax Code, is considered to have been designated as the person's homestead for purposes of this subchapter if the property is listed as the person's residence homestead on the most recent appraisal roll for the appraisal district established for the county in which the property is located. If a person designates property as a homestead under Subsection (c) or Subchapter B and a different property is considered to have been designated as the person's homestead under this subsection, the designation under Subsection (c) or Subchapter B, as applicable, prevails for purposes of this chapter. (2400)

(f) If a person or persons, as applicable, have not made a voluntary designation of a homestead under this section as of the time a writ of execution is issued against the person, any designation of the person's or persons' homestead must be made in accordance with Subchapter B. (2401)

(g) An instrument that made a voluntary designation of a homestead in accordance with prior law and that is on file with the county clerk on September 1, 1987, is considered a voluntary designation of a homestead under this section. (2402)

Added by Acts 1987, 70th Leg., ch. 727, Sec. 1, eff. Aug. 31, 1987. Amended by Acts 1993, 73rd Leg., ch. 48, Sec. 3, eff. Sept. 1, 1993; Acts 1993, 73rd Leg., ch. 297, Sec. 1, eff. Aug. 1, 1993; Acts 1997, 75th Leg., ch. 846, Sec. 1, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 1510, Sec. 3, eff. Jan. 1, 2000. (2403)

Sec. 41.0051. DISCLAIMER AND DISCLOSURE REQUIRED. (2404)(1-click HTML)

(a) A person may not deliver a written advertisement offering, for a fee, to designate property as a homestead as provided by Section 41.005 unless there is a disclaimer on the advertisement that is conspicuous and printed in 14-point boldface type or 14-point uppercase typewritten letters that makes the following statement or a substantially similar statement: (2405)

THIS DOCUMENT IS AN ADVERTISEMENT OF SERVICES. IT IS NOT AN OFFICIAL DOCUMENT OF THE STATE OF TEXAS. (2406)

(b) A person who solicits solely by mail or by telephone a homeowner to pay a fee for the service of applying for a property tax refund from a tax appraisal district or other governmental body on behalf of the homeowner shall, before accepting money from the homeowner or signing a contract with the homeowner for the person's services, disclose to the homeowner the name of the tax appraisal district or other governmental body that owes the homeowner a refund. (2407)

(c) A person's failure to provide a disclaimer on an advertisement as required by Subsection (a) or to provide the disclosure required by Subsection (b) is considered a false, misleading, or deceptive act or practice for purposes of Section 17.46(a), Business & Commerce Code, and is subject to action by the consumer protection division of the attorney general's office as provided by Section 17.46(a), Business & Commerce Code. (2408)

Added by Acts 2001, 77th Leg., ch. 341, Sec. 1, eff. Sept. 1, 2001. Amended by Acts 2003, 78th Leg., ch. 1191, Sec. 1, 2, eff. Sept. 1, 2003. (2409)

Sec. 41.006. CERTAIN SALES OF HOMESTEAD. (2410)(1-click HTML)

(a) Except as provided by Subsection (c), any sale or purported sale in whole or in part of a homestead at a fixed purchase price that is less than the appraised fair market value of the property at the time of the sale or purported sale, and in connection with which the buyer of the property executes a lease of the property to the seller at lease payments that exceed the fair rental value of the property, is considered to be a loan with all payments made from the seller to the buyer in excess of the sales price considered to be interest subject to Title 4, Finance Code. (2411)

(b) The taking of any deed in connection with a transaction described by this section is a deceptive trade practice under Subchapter E, Chapter 17, Business & Commerce Code, and the deed is void and no lien attaches to the homestead property as a result of the purported sale. (2412)

(c) This section does not apply to the sale of a family homestead to a parent, stepparent, grandparent, child, stepchild, brother, half brother, sister, half sister, or grandchild of an adult member of the family. (2413)

Added by Acts 1987, 70th Leg., ch. 1130, Sec. 1, eff. Sept. 1, 1987. Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.84, eff. Sept. 1, 1999. (2414)

Sec. 41.007. HOME IMPROVEMENT CONTRACT. (2415)(1-click HTML)

(a) A contract for improvements to an existing residence described by Section 41.001(b)(3) must contain: (2416)

(1) the contractor's certificate of registration number from the Texas Residential Construction Commission if the contractor is required to register as a builder with the commission; (2417)

(2) the address and telephone number at which the owner may file a complaint with the Texas Residential Construction Commission about the conduct of the contractor if the contractor is required to register as a builder with the commission; and (2418)

(3) the following warning conspicuously printed, stamped, or typed in a size equal to at least 10-point bold type or computer equivalent: (2419)

"IMPORTANT NOTICE: You and your contractor are responsible for meeting the terms and conditions of this contract. If you sign this contract and you fail to meet the terms and conditions of this contract, you may lose your legal ownership rights in your home. KNOW YOUR RIGHTS AND DUTIES UNDER THE LAW." (2420)

(b) A violation of Subsection (a) of this section is a false, misleading, or deceptive act or practice within the meaning of Section 17.46, Business & Commerce Code, and is actionable in a public or private suit brought under the provisions of the Deceptive Trade Practices-Consumer Protection Act (Subchapter E, Chapter 17, Business & Commerce Code). (2421)

(c) A provision of a contract for improvements to an existing residence described by Section 41.001(b)(3) that requires the parties to submit a dispute arising under the contract to binding arbitration must be conspicuously printed or typed in a size equal to at least 10-point bold type or the computer equivalent. (2422)

(d) A provision described by Subsection (c) is not enforceable against the owner unless the requirements of Subsection (c) are met. (2423)

Added by Acts 1987, 70th Leg., ch. 116, Sec. 1, eff. Sept. 1, 1987. Renumbered from Sec. 41.005 by Acts 1989, 71st Leg., ch. 2, Sec. 16.01(30), eff. Aug. 28, 1989. Amended by Acts 1993, 73rd Leg., ch. 48, Sec. 4, eff. Sept. 1, 1993. (2424)

Amended by: (2425)

Acts 2007, 80th Leg., R.S., Ch. 843 (H.B. 1038), Sec. 5, eff. September 1, 2007. (2426)

Sec. 41.008. CONFLICT WITH FEDERAL LAW. (2427)(1-click HTML)

To the extent of any conflict between this subchapter and any federal law that imposes an upper limit on the amount, including the monetary amount or acreage amount, of homestead property a person may exempt from seizure, this subchapter prevails to the extent allowed under federal law. (2428)

Added by Acts 1999, 76th Leg., ch. 1510, Sec. 4. (2429)

SUBCHAPTER B. DESIGNATION OF A HOMESTEAD IN AID OF ENFORCEMENT OF A JUDGMENT DEBT (2430)(1-click HTML)
Sec. 41.021. NOTICE TO DESIGNATE. (2431)(1-click HTML)

If an execution is issued against a holder of an interest in land of which a homestead may be a part and the judgment debtor has not made a voluntary designation of a homestead under Section 41.005, the judgment creditor may give the judgment debtor notice to designate the homestead as defined in Section 41.002. The notice shall state that if the judgment debtor fails to designate the homestead within the time allowed by Section 41.022, the court will appoint a commissioner to make the designation at the expense of the judgment debtor. (2432)

Amended by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985; Acts 1987, 70th Leg., ch. 727, Sec. 2, eff. Aug. 31, 1987. (2433)

Sec. 41.022. DESIGNATION BY HOMESTEAD CLAIMANT. (2434)(1-click HTML)

At any time before 10 a.m. on the Monday next after the expiration of 20 days after the date of service of the notice to designate, the judgment debtor may designate the homestead as defined in Section 41.002 by filing a written designation, signed by the judgment debtor, with the justice or clerk of the court from which the writ of execution was issued, together with a plat of the area designated. (2435)

Amended by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985. (2436)

Sec. 41.023. DESIGNATION BY COMMISSIONER. (2437)(1-click HTML)

(a) If a judgment debtor who has not made a voluntary designation of a homestead under Section 41.005 does not designate a homestead as provided in Section 41.022, on motion of the judgment creditor, filed within 90 days after the issuance of the writ of execution, the court from which the writ of execution issued shall appoint a commissioner to designate the judgment debtor's homestead. The court may appoint a surveyor and others as may be necessary to assist the commissioner. The commissioner shall file his designation of the judgment debtor's homestead in a written report, together with a plat of the area designated, with the justice or clerk of the court not more than 60 days after the order of appointment is signed or within such time as the court may allow. (2438)

(b) Within 10 days after the commissioner's report is filed, the judgment debtor or the judgment creditor may request a hearing on the issue of whether the report should be confirmed, rejected, or modified as may be deemed appropriate in the particular circumstances of the case. The commissioner's report may be contradicted by evidence from either party, when exceptions to it or any item thereof have been filed before the hearing, but not otherwise. After the hearing, or if there is no hearing requested, the court shall designate the homestead as deemed appropriate and order sale of the excess. (2439)

(c) The commissioner, a surveyor, and others appointed to assist the commissioner are entitled to such fees and expenses as are deemed reasonable by the court. The court shall tax these fees and expenses against the judgment debtor as part of the costs of execution. (2440)

Amended by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985; Acts 1987, 70th Leg., ch. 727, Sec. 3, eff. Aug. 31, 1987. (2441)

Sec. 41.024. SALE OF EXCESS. (2442)(1-click HTML)

An officer holding an execution sale of property of a judgment debtor whose homestead has been designated under this chapter may sell the excess of the judgment debtor's interest in land not included in the homestead. (2443)

Amended by Acts 1985, 69th Leg., ch. 840, Sec. 1, eff. June 15, 1985; Acts 1987, 70th Leg., ch. 727, Sec. 4, eff. Aug. 31, 1987. (2444)

CHAPTER 42. PERSONAL PROPERTY (2445)(1-click HTML)
Sec. 42.001. PERSONAL PROPERTY EXEMPTION. (2446)(1-click HTML)

(a) Personal property, as described in Section 42.002, is exempt from garnishment, attachment, execution, or other seizure if: (2447)

(1) the property is provided for a family and has an aggregate fair market value of not more than $100,000, exclusive of the amount of any liens, security interests, or other charges encumbering the property; or (2448)

(2) the property is owned by a single adult, who is not a member of a family, and has an aggregate fair market value of not more than $50,000, exclusive of the amount of any liens, security interests, or other charges encumbering the property. (2449)

(b) The following personal property is exempt from seizure and is not included in the aggregate limitations prescribed by Subsection (a): (2450)

(1) current wages for personal services, except for the enforcement of court-ordered child support payments; (2451)

(2) professionally prescribed health aids of a debtor or a dependent of a debtor; (2452)

(3) alimony, support, or separate maintenance received or to be received by the debtor for the support of the debtor or a dependent of the debtor; and (2453)

(4) a religious bible or other book containing sacred writings of a religion that is seized by a creditor other than a lessor of real property who is exercising the lessor's contractual or statutory right to seize personal property after a tenant breaches a lease agreement for or abandons the real property. (2454)

(c) Except as provided by Subsection (b)(4), this section does not prevent seizure by a secured creditor with a contractual landlord's lien or other security in the property to be seized. (2455)

(d) Unpaid commissions for personal services not to exceed 25 percent of the aggregate limitations prescribed by Subsection (a) are exempt from seizure and are included in the aggregate. (2456)

(e) A religious bible or other book described by Subsection (b)(4) that is seized by a lessor of real property in the exercise of the lessor's contractual or statutory right to seize personal property after a tenant breaches a lease agreement for the real property or abandons the real property may not be included in the aggregate limitations prescribed by Subsection (a). (2457)

Acts 1983, 68th Leg., p. 3522, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1991, 72nd Leg., ch. 175, Sec. 1, eff. May 24, 1991; Acts 1997, 75th Leg., ch. 1046, Sec. 1, eff. Sept. 1, 1997. (2458)

Amended by: (2459)

Acts 2007, 80th Leg., R.S., Ch. 444 (H.B. 167), Sec. 1, eff. September 1, 2007. (2460)

Acts 2015, 84th Leg., R.S., Ch. 793 (H.B. 2706), Sec. 1, eff. September 1, 2015. (2461)

Sec. 42.002. PERSONAL PROPERTY. (2462)(1-click HTML)

(a) The following personal property is exempt under Section 42.001(a): (2463)

(1) home furnishings, including family heirlooms; (2464)

(2) provisions for consumption; (2465)

(3) farming or ranching vehicles and implements; (2466)

(4) tools, equipment, books, and apparatus, including boats and motor vehicles used in a trade or profession; (2467)

(5) wearing apparel; (2468)

(6) jewelry not to exceed 25 percent of the aggregate limitations prescribed by Section 42.001(a); (2469)

(7) two firearms; (2470)

(8) athletic and sporting equipment, including bicycles; (2471)

(9) a two-wheeled, three-wheeled, or four-wheeled motor vehicle for each member of a family or single adult who holds a driver's license or who does not hold a driver's license but who relies on another person to operate the vehicle for the benefit of the nonlicensed person; (2472)

(10) the following animals and forage on hand for their consumption: (2473)

(A) two horses, mules, or donkeys and a saddle, blanket, and bridle for each; (2474)

(B) 12 head of cattle; (2475)

(C) 60 head of other types of livestock; and (2476)

(D) 120 fowl; and (2477)

(11) household pets. (2478)

(b) Personal property, unless precluded from being encumbered by other law, may be encumbered by a security interest under Subchapter B, Chapter 9, Business & Commerce Code, or Subchapter F, Chapter 501, Transportation Code, or by a lien fixed by other law, and the security interest or lien may not be avoided on the ground that the property is exempt under this chapter. (2479)

Acts 1983, 68th Leg., p. 3522, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1991, 72nd Leg., ch. 175, Sec. 1, eff. May 24, 1991; Acts 1993, 73rd Leg., ch. 216, Sec. 1, eff. May, 17, 1993; Acts 1997, 75th Leg., ch. 165, Sec. 30.245, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 414, Sec. 2.36, eff. July 1, 2001; Acts 1999, 76th Leg., ch. 846, Sec. 1, eff. Aug. 30, 1999. (2480)

Sec. 42.0021. ADDITIONAL EXEMPTION FOR CERTAIN SAVINGS PLANS. (2481)(1-click HTML)

(a) In addition to the exemption prescribed by Section 42.001, a person's right to the assets held in or to receive payments, whether vested or not, under any stock bonus, pension, annuity, deferred compensation, profit-sharing, or similar plan, including a retirement plan for self-employed individuals, or a simplified employee pension plan, an individual retirement account or individual retirement annuity, including an inherited individual retirement account, individual retirement annuity, Roth IRA, or inherited Roth IRA, or a health savings account, and under any annuity or similar contract purchased with assets distributed from that type of plan or account, is exempt from attachment, execution, and seizure for the satisfaction of debts to the extent the plan, contract, annuity, or account is exempt from federal income tax, or to the extent federal income tax on the person's interest is deferred until actual payment of benefits to the person under Section 223, 401(a), 403(a), 403(b), 408(a), 408A, 457(b), or 501(a), Internal Revenue Code of 1986, including a government plan or church plan described by Section 414(d) or (e), Internal Revenue Code of 1986. For purposes of this subsection, the interest of a person in a plan, annuity, account, or contract acquired by reason of the death of another person, whether as an owner, participant, beneficiary, survivor, coannuitant, heir, or legatee, is exempt to the same extent that the interest of the person from whom the plan, annuity, account, or contract was acquired was exempt on the date of the person's death. If this subsection is held invalid or preempted by federal law in whole or in part or in certain circumstances, the subsection remains in effect in all other respects to the maximum extent permitted by law. (2482)

(b) Contributions to an individual retirement account that exceed the amounts permitted under the applicable provisions of the Internal Revenue Code of 1986 and any accrued earnings on such contributions are not exempt under this section unless otherwise exempt by law. Amounts qualifying as nontaxable rollover contributions under Section 402(a)(5), 403(a)(4), 403(b)(8), or 408(d)(3) of the Internal Revenue Code of 1986 before January 1, 1993, are treated as exempt amounts under Subsection (a). Amounts treated as qualified rollover contributions under Section 408A, Internal Revenue Code of 1986, are treated as exempt amounts under Subsection (a). In addition, amounts qualifying as nontaxable rollover contributions under Section 402(c), 402(e)(6), 402(f), 403(a)(4), 403(a)(5), 403(b)(8), 403(b)(10), 408(d)(3), or 408A of the Internal Revenue Code of 1986 on or after January 1, 1993, are treated as exempt amounts under Subsection (a). Amounts qualifying as nontaxable rollover contributions under Section 223(f)(5) of the Internal Revenue Code of 1986 on or after January 1, 2004, are treated as exempt amounts under Subsection (a). (2483)

(c) Amounts distributed from a plan, annuity, account, or contract entitled to an exemption under Subsection (a) are not subject to seizure for a creditor's claim for 60 days after the date of distribution if the amounts qualify as a nontaxable rollover contribution under Subsection (b). (2484)

(d) A participant or beneficiary of a plan, annuity, account, or contract entitled to an exemption under Subsection (a), other than an individual retirement account or individual retirement annuity, is not prohibited from granting a valid and enforceable security interest in the participant's or beneficiary's right to the assets held in or to receive payments under the exempt plan, annuity, account, or contract to secure a loan to the participant or beneficiary from the exempt plan, annuity, account, or contract, and the right to the assets held in or to receive payments from the plan, annuity, account, or contract is subject to attachment, execution, and seizure for the satisfaction of the security interest or lien granted by the participant or beneficiary to secure the loan. (2485)

(e) If Subsection (a) is declared invalid or preempted by federal law, in whole or in part or in certain circumstances, as applied to a person who has not brought a proceeding under Title 11, United States Code, the subsection remains in effect, to the maximum extent permitted by law, as to any person who has filed that type of proceeding. (2486)

(f) A reference in this section to a specific provision of the Internal Revenue Code of 1986 includes a subsequent amendment of the substance of that provision. (2487)

Added by Acts 1987, 70th Leg., ch. 376, Sec. 1, eff. Sept. 1, 1987. Amended by Acts 1989, 71st Leg., ch. 1122, Sec. 1, eff. Sept. 1, 1989; Acts 1995, 74th Leg., ch. 963, Sec. 1, eff. Aug. 28, 1995; Acts 1999, 76th Leg., ch. 106, Sec. 1, eff. Sept. 1, 1999. (2488)

Amended by: (2489)

Acts 2005, 79th Leg., Ch. 130 (H.B. 330), Sec. 1, eff. May 24, 2005. (2490)

Acts 2005, 79th Leg., Ch. 130 (H.B. 330), Sec. 2, eff. May 24, 2005. (2491)

Acts 2011, 82nd Leg., R.S., Ch. 933 (S.B. 1810), Sec. 1, eff. June 17, 2011. (2492)

Acts 2013, 83rd Leg., R.S., Ch. 91 (S.B. 649), Sec. 2, eff. September 1, 2013. (2493)

Sec. 42.0022. EXEMPTION FOR COLLEGE SAVINGS PLANS. (2494)(1-click HTML)

(a) In addition to the exemption prescribed by Section 42.001, a person's right to the assets held in or to receive payments or benefits under any of the following is exempt from attachment, execution, and seizure for the satisfaction of debts: (2495)

(1) any fund or plan established under Subchapter F, Chapter 54, Education Code, including the person's interest in a prepaid tuition contract; (2496)

(2) any fund or plan established under Subchapter G, Chapter 54, Education Code, including the person's interest in a savings trust account; or (2497)

(3) any qualified tuition program of any state that meets the requirements of Section 529, Internal Revenue Code of 1986, as amended. (2498)

(b) If any portion of this section is held to be invalid or preempted by federal law in whole or in part or in certain circumstances, this section remains in effect in all other respects to the maximum extent permitted by law. (2499)

Added by Acts 2003, 78th Leg., ch. 113, Sec. 1, eff. Sept. 1, 2003. (2500)

Sec. 42.003. DESIGNATION OF EXEMPT PROPERTY. (2501)(1-click HTML)

(a) If the number or amount of a type of personal property owned by a debtor exceeds the exemption allowed by Section 42.002 and the debtor can be found in the county where the property is located, the officer making a levy on the property shall ask the debtor to designate the personal property to be levied on. If the debtor cannot be found in the county or the debtor fails to make a designation within a reasonable time after the officer's request, the officer shall make the designation. (2502)

(b) If the aggregate value of a debtor's personal property exceeds the amount exempt from seizure under Section 42.001(a), the debtor may designate the portion of the property to be levied on. If, after a court's request, the debtor fails to make a designation within a reasonable time or if for any reason a creditor contests that the property is exempt, the court shall make the designation. (2503)

Acts 1983, 68th Leg., p. 3524, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1991, 72nd Leg., ch. 175, Sec. 1, eff. May 24, 1991. (2504)

Sec. 42.004. TRANSFER OF NONEXEMPT PROPERTY. (2505)(1-click HTML)

(a) If a person uses the property not exempt under this chapter to acquire, obtain an interest in, make improvement to, or pay an indebtedness on personal property which would be exempt under this chapter with the intent to defraud, delay, or hinder an interested person from obtaining that to which the interested person is or may be entitled, the property, interest, or improvement acquired is not exempt from seizure for the satisfaction of liabilities. If the property, interest, or improvement is acquired by discharging an encumbrance held by a third person, a person defrauded, delayed, or hindered is subrogated to the rights of the third person. (2506)

(b) A creditor may not assert a claim under this section more than two years after the transaction from which the claim arises. A person with a claim that is unliquidated or contingent at the time of the transaction may not assert a claim under this section more than one year after the claim is reduced to judgment. (2507)

(c) It is a defense to a claim under this section that the transfer was made in the ordinary course of business by the person making the transfer. (2508)

Acts 1983, 68th Leg., p. 3524, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1991, 72nd Leg., ch. 175, Sec. 1, eff. May 24, 1991. (2509)

Sec. 42.005. CHILD SUPPORT LIENS. (2510)(1-click HTML)

Sections 42.001, 42.002, and 42.0021 of this code do not apply to a child support lien established under Subchapter G, Chapter 157, Family Code. (2511)

Added by Acts 1991, 72nd Leg., 1st C.S., ch. 15, Sec. 4.07, eff. Sept. 1, 1991. Amended by Acts 1997, 75th Leg., ch. 165, Sec. 7.56, eff. Sept. 1, 1997. (2512)

CHAPTER 43. EXEMPT PUBLIC PROPERTY (2513)(1-click HTML)
Sec. 43.001. EXEMPT PUBLIC LIBRARY. (2514)(1-click HTML)

A public library is exempt from attachment, execution, and forced sale. (2515)

Acts 1983, 68th Leg., p. 3525, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2516)

Sec. 43.002. EXEMPT PROPERTY. (2517)(1-click HTML)

The real property of the state, including the real property held in the name of state agencies and funds, and the real property of a political subdivision of the state are exempt from attachment, execution, and forced sale. A judgment lien or abstract of judgment may not be filed or perfected against the state, a unit of state government, or a political subdivision of the state on property owned by the state, a unit of state government, or a political subdivision of the state; any such judgment lien or abstract of judgment is void and unenforceable. (2518)

Added by Acts 1997, 75th Leg., ch. 159, Sec. 1, eff. May 20, 1997. (2519)

CHAPTER 44. TAXATION OF RETIREMENT BENEFITS BY ANOTHER STATE (2520)(1-click HTML)
Sec. 44.001. DEFINITION. (2521)(1-click HTML)

In this chapter, "pension or other retirement plan" includes: (2522)

(1) an annuity, pension, or profit-sharing or stock bonus or similar plan established to provide retirement benefits for an officer or employee of a public or private employer or for a self-employed individual; (2523)

(2) an annuity, pension, or military retirement pay plan or other retirement plan administered by the United States; and (2524)

(3) an individual retirement account. (2525)

Added by Acts 1993, 73rd Leg., ch. 95, Sec. 1, eff. May 7, 1993. (2526)

Sec. 44.002. PROPERTY EXEMPT. (2527)(1-click HTML)

All property in this state is exempt from attachment, execution, and seizure for the satisfaction of a judgment or claim in favor of another state or political subdivision of another state for failure to pay that state's or that political subdivision's income tax on benefits received from a pension or other retirement plan. (2528)

Added by Acts 1993, 73rd Leg., ch. 95, Sec. 1, eff. May 7, 1993. (2529)

Sec. 44.003. LIEN NOT CREATED. (2530)(1-click HTML)

A claim or judgment in favor of another state or political subdivision of another state for failure to pay that state's or that political subdivision's income tax on benefits received from a pension or other retirement plan may not be a lien on any property in this state owned by a resident of this state. (2531)

Added by Acts 1993, 73rd Leg., ch. 95, Sec. 1, eff. May 7, 1993. (2532)

SUBTITLE B. LIENS (2533)(1-click HTML)

CHAPTER 51. PROVISIONS GENERALLY APPLICABLE TO LIENS (2534)(1-click HTML)
Sec. 51.0001. DEFINITIONS. (2535)(1-click HTML)

In this chapter: (2536)

(1) "Book entry system" means a national book entry system for registering a beneficial interest in a security instrument that acts as a nominee for the grantee, beneficiary, owner, or holder of the security instrument and its successors and assigns. (2537)

(2) "Debtor's last known address" means: (2538)

(A) for a debt secured by the debtor's residence, the debtor's residence address unless the debtor provided the mortgage servicer a written change of address before the date the mortgage servicer mailed a notice required by Section 51.002; or (2539)

(B) for a debt other than a debt described by Paragraph (A), the debtor's last known address as shown by the records of the mortgage servicer of the security instrument unless the debtor provided the current mortgage servicer a written change of address before the date the mortgage servicer mailed a notice required by Section 51.002. (2540)

(3) "Mortgage servicer" means the last person to whom a mortgagor has been instructed by the current mortgagee to send payments for the debt secured by a security instrument. A mortgagee may be the mortgage servicer. (2541)

(4) "Mortgagee" means: (2542)

(A) the grantee, beneficiary, owner, or holder of a security instrument; (2543)

(B) a book entry system; or (2544)

(C) if the security interest has been assigned of record, the last person to whom the security interest has been assigned of record. (2545)

(5) "Mortgagor" means the grantor of a security instrument. (2546)

(6) "Security instrument" means a deed of trust, mortgage, or other contract lien on an interest in real property. (2547)

(7) "Substitute trustee" means a person appointed by the current mortgagee or mortgage servicer under the terms of the security instrument to exercise the power of sale. (2548)

(8) "Trustee" means a person or persons authorized to exercise the power of sale under the terms of a security instrument in accordance with Section 51.0074. (2549)

Added by Acts 2003, 78th Leg., ch. 554, Sec. 1, eff. Jan. 1, 2004. (2550)

Amended by: (2551)

Acts 2007, 80th Leg., R.S., Ch. 903 (H.B. 2738), Sec. 1, eff. June 15, 2007. (2552)

Sec. 51.001. EFFECT ON OTHER LIENS. (2553)(1-click HTML)

Except as provided by Chapter 59, this subtitle does not affect: (2554)

(1) the right to create a lien by special contract or agreement; or (2555)

(2) a lien that is not treated in this subtitle, including a lien arising under common law, in equity, or under another statute of this state. (2556)

Acts 1983, 68th Leg., p. 3525, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2557)

Sec. 51.0011. DEFAULT ARISING FROM DELINQUENT AD VALOREM TAXES: INSTALLMENT AGREEMENTS. (2558)(1-click HTML)

(a) Notwithstanding any agreement to the contrary, a debtor is not in default under a deed of trust or other contract lien on real property used as the debtor's residence for the delinquent payment of ad valorem taxes if: (2559)

(1) the debtor gave notice to the mortgage servicer of the intent to enter into an installment agreement with the taxing unit under Section 33.02, Tax Code, for the payment of the taxes at least 10 days before the date the debtor entered into the agreement; and (2560)

(2) the property is protected from seizure and sale and a suit may not be filed to collect a delinquent tax on the property as provided by Section 33.02(d), Tax Code. (2561)

(b) A mortgage servicer who receives a notice described by Subsection (a)(1) may pay the taxes subject to the installment agreement at any time. (2562)

(c) A mortgage servicer who receives a notice described by Subsection (a)(1) and gives the debtor notice that the mortgage servicer intends to accelerate the note securing the deed of trust or other contract lien as a result of the delinquency of the taxes that are subject to the installment agreement must rescind the notice if the debtor enters into the agreement not later than the 30th day after the date the debtor delivers the notice. (2563)

Added by Acts 2013, 83rd Leg., R.S., Ch. 935 (H.B. 1597), Sec. 4, eff. September 1, 2013. (2564)

Sec. 51.002. SALE OF REAL PROPERTY UNDER CONTRACT LIEN. (2565)(1-click HTML)

(a) A sale of real property under a power of sale conferred by a deed of trust or other contract lien must be a public sale at auction held between 10 a.m. and 4 p.m. of the first Tuesday of a month. Except as provided by Subsection (h), the sale must take place at the county courthouse in the county in which the land is located, or if the property is located in more than one county, the sale may be made at the courthouse in any county in which the property is located. The commissioners court shall designate the area at the courthouse where the sales are to take place and shall record the designation in the real property records of the county. The sale must occur in the designated area. If no area is designated by the commissioners court, the notice of sale must designate the area where the sale covered by that notice is to take place, and the sale must occur in that area. (2566)

(b) Except as provided by Subsection (b-1), notice of the sale, which must include a statement of the earliest time at which the sale will begin, must be given at least 21 days before the date of the sale by: (2567)

(1) posting at the courthouse door of each county in which the property is located a written notice designating the county in which the property will be sold; (2568)

(2) filing in the office of the county clerk of each county in which the property is located a copy of the notice posted under Subdivision (1); and (2569)

(3) serving written notice of the sale by certified mail on each debtor who, according to the records of the mortgage servicer of the debt, is obligated to pay the debt. (2570)

(b-1) If the courthouse or county clerk's office is closed because of inclement weather, natural disaster, or other act of God, a notice required to be posted at the courthouse under Subsection (b)(1) or filed with the county clerk under Subsection (b)(2) may be posted or filed, as appropriate, up to 48 hours after the courthouse or county clerk's office reopens for business, as applicable. (2571)

(c) The sale must begin at the time stated in the notice of sale or not later than three hours after that time. (2572)

(d) Notwithstanding any agreement to the contrary, the mortgage servicer of the debt shall serve a debtor in default under a deed of trust or other contract lien on real property used as the debtor's residence with written notice by certified mail stating that the debtor is in default under the deed of trust or other contract lien and giving the debtor at least 20 days to cure the default before notice of sale can be given under Subsection (b). The entire calendar day on which the notice required by this subsection is given, regardless of the time of day at which the notice is given, is included in computing the 20-day notice period required by this subsection, and the entire calendar day on which notice of sale is given under Subsection (b) is excluded in computing the 20-day notice period. (2573)

(e) Service of a notice under this section by certified mail is complete when the notice is deposited in the United States mail, postage prepaid and addressed to the debtor at the debtor's last known address. The affidavit of a person knowledgeable of the facts to the effect that service was completed is prima facie evidence of service. (2574)

(f) Each county clerk shall keep all notices filed under Subdivision (2) of Subsection (b) in a convenient file that is available to the public for examination during normal business hours. The clerk may dispose of the notices after the date of sale specified in the notice has passed. The clerk shall receive a fee of $2 for each notice filed. (2575)

(f-1) If a county maintains an Internet website, the county must post a notice of sale filed with the county clerk under Subsection (b)(2) on the website on a page that is publicly available for viewing without charge or registration. (2576)

(g) The entire calendar day on which the notice of sale is given, regardless of the time of day at which the notice is given, is included in computing the 21-day notice period required by Subsection (b), and the entire calendar day of the foreclosure sale is excluded. (2577)

(h) For the purposes of Subsection (a), the commissioners court of a county may designate an area other than an area at the county courthouse where public sales of real property under this section will take place that is in a public place within a reasonable proximity of the county courthouse as determined by the commissioners court and in a location as accessible to the public as the courthouse door. The commissioners court shall record that designation in the real property records of the county. A designation by a commissioners court under this section is not a ground for challenging or invalidating any sale. A sale must be held at an area designated under this subsection if the sale is held on or after the 90th day after the date the designation is recorded. The posting of the notice required by Subsection (b)(1) of a sale designated under this subsection to take place at an area other than an area of the courthouse remains at the courthouse door of the appropriate county. (2578)

(i) Notice served on a debtor under this section must state the name and address of the sender of the notice and contain, in addition to any other statements required under this section, a statement that is conspicuous, printed in boldface or underlined type, and substantially similar to the following: "Assert and protect your rights as a member of the armed forces of the United States. If you are or your spouse is serving on active military duty, including active military duty as a member of the Texas National Guard or the National Guard of another state or as a member of a reserve component of the armed forces of the United States, please send written notice of the active duty military service to the sender of this notice immediately." (2579)

Acts 1983, 68th Leg., p. 3525, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1984, 68th Leg., 2nd C.S., ch. 18, Sec. 3(b), eff. Oct. 2, 1984; Acts 1987, 70th Leg., ch. 540, Sec. 1, eff. Jan. 1, 1988; Acts 1993, 73rd Leg., ch. 48, Sec. 5, eff. Sept. 1, 1993; Acts 2003, 78th Leg., ch. 554, Sec. 2, eff. Jan. 1, 2004. (2580)

Amended by: (2581)

Acts 2005, 79th Leg., Ch. 533 (H.B. 961), Sec. 1, eff. June 17, 2005. (2582)

Acts 2005, 79th Leg., Ch. 555 (H.B. 1235), Sec. 1, eff. September 1, 2005. (2583)

Acts 2007, 80th Leg., R.S., Ch. 903 (H.B. 2738), Sec. 2, eff. June 15, 2007. (2584)

Acts 2011, 82nd Leg., R.S., Ch. 252 (H.B. 1127), Sec. 2, eff. January 1, 2012. (2585)

Acts 2011, 82nd Leg., R.S., Ch. 592 (S.B. 101), Sec. 1, eff. September 1, 2011. (2586)

Acts 2013, 83rd Leg., R.S., Ch. 52 (H.B. 584), Sec. 1, eff. September 1, 2013. (2587)

Acts 2013, 83rd Leg., R.S., Ch. 161 (S.B. 1093), Sec. 17.001, eff. September 1, 2013. (2588)

Acts 2013, 83rd Leg., R.S., Ch. 642 (H.B. 699), Sec. 2, eff. October 1, 2013. (2589)

Sec. 51.0021. NOTICE OF CHANGE OF ADDRESS REQUIRED. (2590)(1-click HTML)

A debtor shall inform the mortgage servicer of the debt in a reasonable manner of any change of address of the debtor for purposes of providing notice to the debtor under Section 51.002. (2591)

Added by Acts 2003, 78th Leg., ch. 554, Sec. 1, eff. Jan. 1, 2004. (2592)

Sec. 51.0025. ADMINISTRATION OF FORECLOSURE BY MORTGAGE SERVICER. (2593)(1-click HTML)

A mortgage servicer may administer the foreclosure of property under Section 51.002 on behalf of a mortgagee if: (2594)

(1) the mortgage servicer and the mortgagee have entered into an agreement granting the current mortgage servicer authority to service the mortgage; and (2595)

(2) the notices required under Section 51.002(b) disclose that the mortgage servicer is representing the mortgagee under a servicing agreement with the mortgagee and the name of the mortgagee and: (2596)

(A) the address of the mortgagee; or (2597)

(B) the address of the mortgage servicer, if there is an agreement granting a mortgage servicer the authority to service the mortgage. (2598)

Added by Acts 2003, 78th Leg., ch. 554, Sec. 1, eff. Jan. 1, 2004. (2599)

Amended by: (2600)

Acts 2005, 79th Leg., Ch. 555 (H.B. 1235), Sec. 2, eff. September 1, 2005. (2601)

Sec. 51.003. DEFICIENCY JUDGMENT. (2602)(1-click HTML)

(a) If the price at which real property is sold at a foreclosure sale under Section 51.002 is less than the unpaid balance of the indebtedness secured by the real property, resulting in a deficiency, any action brought to recover the deficiency must be brought within two years of the foreclosure sale and is governed by this section. (2603)

(b) Any person against whom such a recovery is sought by motion may request that the court in which the action is pending determine the fair market value of the real property as of the date of the foreclosure sale. The fair market value shall be determined by the finder of fact after the introduction by the parties of competent evidence of the value. Competent evidence of value may include, but is not limited to, the following: (1) expert opinion testimony; (2) comparable sales; (3) anticipated marketing time and holding costs; (4) cost of sale; and (5) the necessity and amount of any discount to be applied to the future sales price or the cashflow generated by the property to arrive at a current fair market value. (2604)

(c) If the court determines that the fair market value is greater than the sale price of the real property at the foreclosure sale, the persons against whom recovery of the deficiency is sought are entitled to an offset against the deficiency in the amount by which the fair market value, less the amount of any claim, indebtedness, or obligation of any kind that is secured by a lien or encumbrance on the real property that was not extinguished by the foreclosure, exceeds the sale price. If no party requests the determination of fair market value or if such a request is made and no competent evidence of fair market value is introduced, the sale price at the foreclosure sale shall be used to compute the deficiency. (2605)

(d) Any money received by a lender from a private mortgage guaranty insurer shall be credited to the account of the borrower prior to the lender bringing an action at law for any deficiency owed by the borrower. Notwithstanding the foregoing, the credit required by this subsection shall not apply to the exercise by a private mortgage guaranty insurer of its subrogation rights against a borrower or other person liable for any deficiency. (2606)

Added by Acts 1991, 72nd Leg., ch. 12, Sec. 1, eff. April 1, 1991. (2607)

Sec. 51.004. JUDICIAL FORECLOSURE--DEFICIENCY. (2608)(1-click HTML)

(a) This section applies if: (2609)

(1) real property subject to a deed of trust or other contract lien is sold at a foreclosure sale under a court judgment foreclosing the lien and ordering the sale; and (2610)

(2) the price at which the real property is sold is less than the unpaid balance of the indebtedness secured by the real property, resulting in a deficiency. (2611)

(b) Any person obligated on the indebtedness, including a guarantor, may bring an action in the district court in the county in which the real property is located for a determination of the fair market value of the real property as of the date of the foreclosure sale. The suit must be brought not later than the 90th day after the date of the foreclosure sale unless the suit is brought by a guarantor who did not receive actual notice of the sale before the date of sale, in which case the suit must be brought by the guarantor not later than the 90th day after the date the guarantor received actual notice of the sale. The fair market value shall be determined by the finder of fact after the introduction by the parties of competent evidence of the value. Competent evidence of value may include: (2612)

(1) expert opinion testimony; (2613)

(2) comparable sales; (2614)

(3) anticipated marketing time and holding costs; (2615)

(4) cost of sale; and (2616)

(5) the necessity and amount of any discount to be applied to the future sales price or the cash flow generated by the property to arrive at a fair market value as of the date of the foreclosure sale. (2617)

(c) If the finder of fact determines that the fair market value is greater than the sale price of the real property at the foreclosure sale, the persons obligated on the indebtedness, including guarantors, are entitled to an offset against the deficiency in the amount by which the fair market value, less the amount of any claim, indebtedness, or obligation of any kind that is secured by a lien or encumbrance on the real property that was not extinguished by the foreclosure, exceeds the sale price. If no competent evidence of fair market value is introduced, the sale price at the foreclosure sale shall be used to compute the deficiency. (2618)

(d) Any money received by a lender from a private mortgage guaranty insurer shall be credited to the account of the borrower before the lender brings an action at law for any deficiency owed by the borrower. However, the credit required by this subsection does not apply to the exercise by a private mortgage guaranty insurer of its subrogation rights against a borrower or other person liable for any deficiency. (2619)

Added by Acts 1991, 72nd Leg., ch. 361, Sec. 1, eff. June 5, 1991. (2620)

Sec. 51.005. JUDICIAL OR NONJUDICIAL FORECLOSURE AFTER JUDGMENT AGAINST GUARANTOR--DEFICIENCY. (2621)(1-click HTML)

(a) This section applies if: (2622)

(1) the holder of a debt obtains a court judgment against a guarantor of the debt; (2623)

(2) real property subject to a deed of trust or other contract lien securing the guaranteed debt is sold at a foreclosure sale under Section 51.002 or under a court judgment foreclosing the lien and ordering the sale; (2624)

(3) the price at which the real property is sold is less than the unpaid balance of the indebtedness secured by the real property, resulting in a deficiency; and (2625)

(4) a motion or suit to determine the fair market value of the real property as of the date of the foreclosure sale has not been filed under Section 51.003 or 51.004. (2626)

(b) The guarantor may bring an action in the district court in the county in which the real property is located for a determination of the fair market value of the real property as of the date of the foreclosure sale. The suit must be brought not later than the 90th day after the date of the foreclosure sale or the date the guarantor receives actual notice of the foreclosure sale, whichever is later. The fair market value shall be determined by the finder of fact after the introduction by the parties of competent evidence of the value. Competent evidence of value may include: (2627)

(1) expert opinion testimony; (2628)

(2) comparable sales; (2629)

(3) anticipated marketing time and holding costs; (2630)

(4) cost of sale; and (2631)

(5) the necessity and amount of any discount to be applied to the future sales price or the cash flow generated by the property to arrive at a fair market value as of the date of the foreclosure sale. (2632)

(c) If the finder of fact determines that the fair market value is greater than the sale price of the real property at the foreclosure sale, the persons obligated on the indebtedness, including guarantors, are entitled to an offset against the deficiency in the amount by which the fair market value, less the amount of any claim, indebtedness, or obligation of any kind that is secured by a lien or encumbrance on the real property that was not extinguished by the foreclosure, exceeds the sale price. If no competent evidence of fair market value is introduced, the sale price at the foreclosure sale shall be used to compute the deficiency. (2633)

(d) Any money received by a lender from a private mortgage guaranty insurer shall be credited to the account of the borrower before the lender brings an action at law for any deficiency owed by the borrower. However, the credit required by this subsection does not apply to the exercise by a private mortgage guaranty insurer of its subrogation rights against a borrower or other person liable for any deficiency. (2634)

Added by Acts 1991, 72nd Leg., ch. 361, Sec. 1, eff. June 5, 1991. (2635)

Sec. 51.006. DEED-OF-TRUST FORECLOSURE AFTER DEED IN LIEU OF FORECLOSURE. (2636)(1-click HTML)

(a) This section applies to a holder of a debt under a deed of trust who accepts from the debtor a deed conveying real property subject to the deed of trust in satisfaction of the debt. (2637)

(b) The holder of a debt may void a deed conveying real property in satisfaction of the debt before the fourth anniversary of the date the deed is executed and foreclosed under the original deed of trust if: (2638)

(1) the debtor fails to disclose to the holder of the debt a lien or other encumbrance on the property before executing the deed conveying the property to the holder of the debt in satisfaction of the debt; and (2639)

(2) the holder of the debt has no personal knowledge of the undisclosed lien or encumbrance on the property. (2640)

(c) A third party may conclusively rely upon the affidavit of the holder of a debt stating that the holder has voided the deed as provided in this section. (2641)

(d) If the holder elects to void a deed in lieu of foreclosure as provided in this section, the priority of its deed of trust shall not be affected or impaired by the execution of the deed in lieu of foreclosure. (2642)

(e) If a holder accepts a deed in lieu of foreclosure, the holder may foreclose its deed of trust as provided in said deed of trust without electing to void the deed. The priority of such deed of trust shall not be affected or impaired by the deed in lieu of foreclosure. (2643)

Added by Acts 1995, 74th Leg., ch. 1020, Sec. 1, eff. Aug. 28, 1995. (2644)

Sec. 51.007. TRUSTEE UNDER DEED OF TRUST, CONTRACT LIEN OR SECURITY INSTRUMENT. (2645)(1-click HTML)

(a) The trustee named in a suit or proceeding may plead in the answer that the trustee is not a necessary party by a verified denial stating the basis for the trustee's reasonable belief that the trustee was named as a party solely in the capacity as a trustee under a deed of trust, contract lien, or security instrument. (2646)

(b) Within 30 days after the filing of the trustee's verified denial, a verified response is due from all parties to the suit or proceeding setting forth all matters, whether in law or fact, that rebut the trustee's verified denial. (2647)

(c) If a party has no objection or fails to file a timely verified response to the trustee's verified denial, the trustee shall be dismissed from the suit or proceeding without prejudice. (2648)

(d) If a respondent files a timely verified response to the trustee's verified denial, the matter shall be set for hearing. The court shall dismiss the trustee from the suit or proceeding without prejudice if the court determines that the trustee is not a necessary party. (2649)

(e) A dismissal of the trustee pursuant to Subsections (c) and (d) shall not prejudice a party's right to seek injunctive relief to prevent the trustee from proceeding with a foreclosure sale. (2650)

(f) A trustee shall not be liable for any good faith error resulting from reliance on any information in law or fact provided by the mortgagor or mortgagee or their respective attorney, agent, or representative or other third party. (2651)

Added by Acts 1999, 76th Leg., ch. 1304, Sec. 1, eff. Sept. 1, 1999. (2652)

Sec. 51.0074. DUTIES OF TRUSTEE. (2653)(1-click HTML)

(a) One or more persons may be authorized to exercise the power of sale under a security instrument. (2654)

(b) A trustee may not be: (2655)

(1) assigned a duty under a security instrument other than to exercise the power of sale in accordance with the terms of the security instrument; or (2656)

(2) held to the obligations of a fiduciary of the mortgagor or mortgagee. (2657)

Added by Acts 2007, 80th Leg., R.S., Ch. 903 (H.B. 2738), Sec. 3, eff. June 15, 2007. (2658)

Sec. 51.0075. AUTHORITY OF TRUSTEE OR SUBSTITUTE TRUSTEE. (2659)(1-click HTML)

(a) A trustee or substitute trustee may set reasonable conditions for conducting the public sale if the conditions are announced before bidding is opened for the first sale of the day held by the trustee or substitute trustee. (2660)

(b) A trustee or substitute trustee is not a debt collector. (2661)

(c) Notwithstanding any agreement to the contrary, a mortgagee may appoint or may authorize a mortgage servicer to appoint a substitute trustee or substitute trustees to succeed to all title, powers, and duties of the original trustee. A mortgagee or mortgage servicer may make an appointment or authorization under this subsection by power of attorney, corporate resolution, or other written instrument. (2662)

(d) A mortgage servicer may authorize an attorney to appoint a substitute trustee or substitute trustees on behalf of a mortgagee under Subsection (c). (2663)

(e) The name and a street address for a trustee or substitute trustees shall be disclosed on the notice required by Section 51.002(b). (2664)

(f) The purchase price in a sale held by a trustee or substitute trustee under this section is due and payable without delay on acceptance of the bid or within such reasonable time as may be agreed upon by the purchaser and the trustee or substitute trustee if the purchaser makes such request for additional time to deliver the purchase price. The trustee or substitute trustee shall disburse the proceeds of the sale as provided by law. (2665)

Added by Acts 2003, 78th Leg., ch. 554, Sec. 1, eff. Jan. 1, 2004. (2666)

Amended by: (2667)

Acts 2005, 79th Leg., Ch. 1231 (H.B. 1234), Sec. 1, eff. September 1, 2005. (2668)

Acts 2007, 80th Leg., R.S., Ch. 903 (H.B. 2738), Sec. 4, eff. June 15, 2007. (2669)

Acts 2009, 81st Leg., R.S., Ch. 323 (H.B. 655), Sec. 1, eff. September 1, 2009. (2670)

Sec. 51.0076. EFFECTIVE DATE OF APPOINTMENT. (2671)(1-click HTML)

The appointment or authorization of a trustee or substitute trustee made in a notice of sale is effective as of the date of the notice if the notice: (2672)

(1) complies with Sections 51.002 and 51.0075(e); (2673)

(2) is signed by an attorney or agent of the mortgagee or mortgage servicer; and (2674)

(3) contains a statement in all capital letters, boldface type, to read as follows: (2675)

THIS INSTRUMENT APPOINTS THE SUBSTITUTE TRUSTEE(S) IDENTIFIED TO SELL THE PROPERTY DESCRIBED IN THE SECURITY INSTRUMENT IDENTIFIED IN THIS NOTICE OF SALE THE PERSON SIGNING THIS NOTICE IS THE ATTORNEY OR AUTHORIZED AGENT OF THE MORTGAGEE OR MORTGAGE SERVICER. (2676)

Added by Acts 2015, 84th Leg., R.S., Ch. 653 (H.B. 2063), Sec. 2, eff. September 1, 2015. (2677)

Sec. 51.008. CERTAIN LIENS ON REAL PROPERTY. (2678)(1-click HTML)

(a) A lien on real property created under this code or another law of this state in favor of a governmental entity must be recorded as provided by Chapters 11 and 12 in the real property records of the county in which the property or a portion of the property is located unless: (2679)

(1) the lien is imposed as a result of failure to pay: (2680)

(A) ad valorem taxes; or (2681)

(B) a penalty or interest owed in connection with those taxes; or (2682)

(2) the law establishing the lien expressly states that recording the lien is not required. (2683)

(b) Any notice of the lien required by law must contain a legal description of the property. (2684)

(c) This section does not apply to: (2685)

(1) a lien created under Section 89.083, Natural Resources Code; (2686)

(2) a state tax lien under Chapter 113, Tax Code; or (2687)

(3) a lien established under Chapter 61 or 213, Labor Code. (2688)

Added by Acts 2001, 77th Leg., ch. 827, Sec. 1, eff. Sept. 1, 2001. (2689)

Sec. 51.009. FORECLOSED PROPERTY SOLD "AS IS". (2690)(1-click HTML)

A purchaser at a sale of real property under Section 51.002: (2691)

(1) acquires the foreclosed property "as is" without any expressed or implied warranties, except as to warranties of title, and at the purchaser's own risk; and (2692)

(2) is not a consumer. (2693)

Added by Acts 2003, 78th Leg., ch. 554, Sec. 1, eff. Jan. 1, 2004. (2694)

Sec. 51.015. SALE OF CERTAIN PROPERTY OWNED BY MEMBER OF THE MILITARY. (2695)(1-click HTML)

(a) In this section: (2696)

(1) "Active duty military service" means: (2697)

(A) service as a member of the armed forces of the United States; and (2698)

(B) with respect to a member of the Texas National Guard or the National Guard of another state or a member of a reserve component of the armed forces of the United States, active duty under an order of the president of the United States. (2699)

(2) "Dwelling" means a residential structure or manufactured home that contains one to four family housing units. (2700)

(3) "Military servicemember" means: (2701)

(A) a member of the armed forces of the United States; (2702)

(B) a member of the Texas National Guard or the National Guard of another state serving on active duty under an order of the president of the United States; or (2703)

(C) a member of a reserve component of the armed forces of the United States who is on active duty under an order of the president of the United States. (2704)

(4) "Person" has the meaning assigned by Section 311.005, Government Code. (2705)

(1-a) "Assessment" and "assessments" have the meanings assigned by Sections 82.113(a) and 209.002, as applicable. (2706)

(b) This section applies only to an obligation: (2707)

(1) that is secured by a mortgage, deed of trust, or other contract lien, including a lien securing payment of an assessment or assessments, as applicable, on real property or personal property that is a dwelling owned by a military servicemember; (2708)

(2) that originates before the date on which the servicemember's active duty military service commences; and (2709)

(3) for which the servicemember is still obligated. (2710)

(c) In an action filed during a military servicemember's period of active duty military service or during the nine months after the date on which that service period concludes to foreclose a lien or otherwise enforce an obligation described by Subsection (b), the court may after a hearing and on the court's own motion, and shall on the application by a servicemember whose ability to comply with the obligations of the contract secured by the lien is materially affected by the servicemember's military service: (2711)

(1) stay the proceedings for a period of time as justice and equity require; or (2712)

(2) adjust the obligations of the contract secured by the lien to preserve the interests of all parties. (2713)

(d) A sale, foreclosure, or seizure of property under a mortgage, deed of trust, or other contract lien described by Subsection (b) may not be conducted during the military servicemember's period of active duty military service or during the nine months after the date on which that service period concludes unless the sale, foreclosure, or seizure is conducted under: (2714)

(1) a court order issued before the sale, foreclosure, or seizure; or (2715)

(2) an agreement that complies with Subsection (e). (2716)

(e) A military servicemember may waive the servicemember's rights under this section only as provided by this subsection. The waiver must be: (2717)

(1) in writing in at least 12-point type; (2718)

(2) executed as an instrument separate from the obligation to which the waiver applies; and (2719)

(3) made under a written agreement: (2720)

(A) executed during or after the servicemember's period of active duty military service; and (2721)

(B) specifying the legal instrument to which the waiver applies and, if the servicemember is not a party to the instrument, the servicemember concerned. (2722)

(f) A person commits an offense if the person knowingly makes or causes to be made a sale, foreclosure, or seizure of property that is prohibited by Subsection (d). An offense under this subsection is a Class A misdemeanor. (2723)

(g) On application to a court, a dependent of a military servicemember is entitled to the protections of this section if the dependent's ability to comply with an obligation that is secured by a mortgage, deed of trust, or other contract lien on real property or personal property that is a dwelling is materially affected by the servicemember's military service. (2724)

(h) A court that issues a stay or takes any other action under this section regarding the enforcement of an obligation that is subject to this section may grant a similar stay or take similar action with respect to a surety, guarantor, endorser, accommodation maker, comaker, or other person who is or may be primarily or secondarily subject to the obligation. (2725)

(i) If a judgment or decree is vacated or set aside wholly or partly under this section, the court may also set aside or vacate, as applicable, the judgment or decree with respect to a surety, guarantor, endorser, accommodation maker, comaker, or other person who is or may be primarily or secondarily subject to the obligation that is subject to the judgment or decree. (2726)

(j) This section does not prevent a waiver in writing by a surety, guarantor, endorser, accommodation maker, comaker, or other person, whether primarily or secondarily liable on an obligation, of the protections provided under Subsections (h) and (i). A waiver described by this subsection is effective only if it is executed as an instrument separate from the obligation with respect to which it applies. If a waiver under this subsection is executed by an individual who after the execution of the waiver enters active duty military service, or by a dependent of an individual who after the execution of the waiver enters active duty military service, the waiver is not valid after the beginning of the period of the active duty military service unless the waiver was executed by the individual or dependent during the applicable period described by 50 U.S.C. App. Section 516, as that section existed on January 1, 2009. (2727)

Added by Acts 2009, 81st Leg., R.S., Ch. 992 (H.B. 3857), Sec. 1, eff. June 19, 2009. (2728)

Amended by: (2729)

Acts 2011, 82nd Leg., R.S., Ch. 592 (S.B. 101), Sec. 2, eff. September 1, 2011. (2730)

Acts 2011, 82nd Leg., R.S., Ch. 592 (S.B. 101), Sec. 3, eff. September 1, 2011. (2731)

Sec. 51.016. RESCISSION OF NONJUDICIAL FORECLOSURE SALES. (2732)(1-click HTML)

(a) This section applies only to a nonjudicial foreclosure sale of residential real property conducted under Section 51.002. In this subsection, "residential real property" means: (2733)

(1) a single family home, duplex, triplex, or quadraplex; or (2734)

(2) a unit in a multiunit residential structure in which title to an individual unit is transferred to the owner of the unit under a condominium or cooperative system. (2735)

(b) Not later than the 15th calendar day after the date of a foreclosure sale, a mortgagee, trustee, or substitute trustee may rescind the sale under this section if: (2736)

(1) the statutory requirements for the sale were not satisfied; (2737)

(2) the default leading to the sale was cured before the sale; (2738)

(3) a receivership or dependent probate administration involving the property was pending at the time of sale; (2739)

(4) a condition specified in the conditions of sale prescribed by the trustee or substitute trustee before the sale and made available in writing to prospective bidders at the sale was not met; (2740)

(5) the mortgagee or mortgage servicer and the debtor agreed before the sale to cancel the sale based on an enforceable written agreement by the debtor to cure the default; or (2741)

(6) at the time of the sale, a court-ordered or automatic stay of the sale imposed in a bankruptcy case filed by a person with an interest in the property was in effect. (2742)

(c) On or before the 15th calendar day after the date of the sale, the party rescinding the sale shall: (2743)

(1) serve a written notice of rescission that describes the reason for the rescission and includes recording information for any affected trustee's or substitute trustee's deed that was recorded on: (2744)

(A) the purchaser, if the mortgagee is not the purchaser; and (2745)

(B) each debtor who, according to the records of the mortgage servicer of the debt, is obligated to pay the debt; and (2746)

(2) file each notice for recording in the real property records of the county in which all or a part of the property is located. (2747)

(d) A notice required by Subsection (c) must be served by certified mail. Service of the notice is complete when the notice is deposited in the United States mail, postage prepaid and addressed to the purchaser or debtor, as applicable, at the purchaser's or debtor's last known address, as applicable. The affidavit of a person knowledgeable of the facts to the effect that service was completed is prima facie evidence of service. (2748)

(e) Not later than the fifth calendar day after the date a foreclosure sale is rescinded under this section, the mortgagee shall return to the purchaser by certified mail, electronic or wire transfer, or courier service with delivery tracking the amount of the bid paid by the purchaser for the property at the sale. The debtor shall return to the trustee the amount of any excess proceeds received by the debtor from the sale. The return of the bid amount is considered made on the date: (2749)

(1) the bid amount is deposited postage prepaid in the United States mail or with the courier service addressed to the purchaser at the purchaser's last known address; or (2750)

(2) the electronic or wire transfer is ordered. (2751)

(f) The rescinding mortgagee, trustee, or substitute trustee shall cause to be filed for recording in the real property records of the county where the notice required under Subsection (c) was recorded an affidavit stating the date the bid amount was returned together with the certified mail, electronic or wire transfer, or courier service delivery tracking information. (2752)

(g) An affidavit executed and filed in accordance with Subsection (f) is prima facie evidence of the return of the bid amount and of the authority of the maker of the affidavit. A bona fide purchaser, lender, or other person acquiring an interest in the property or an insurer of title is entitled to rely conclusively on the record of the filed affidavit and notice, and any subsequent purchaser in good faith and for value is entitled to bona fide purchaser protection. (2753)

(h) The rescission of a foreclosure sale under this section restores the mortgagee and the debtor to their respective title, rights, and obligations under any instrument relating to the foreclosed property that existed immediately prior to the sale. (2754)

(i) A rescission of a foreclosure sale under this section is void as to a creditor or to a subsequent purchaser for a valuable consideration without notice unless notice of the rescission has been acknowledged, sworn to, or proved and filed for recording as required by law. A rescission of a foreclosure sale under this section evidenced by an unrecorded instrument is binding on a party to the instrument, on the party's heirs, and on a subsequent purchaser who does not pay a valuable consideration or who has notice of the instrument. (2755)

(j) No action challenging the effectiveness of a rescission under this section may be commenced unless the action is filed on or before the 30th calendar day after the date the notices of rescission required by Subsection (c) are filed for recording. A lis pendens notice based on the rescission not recorded within that period has no effect. This subsection does not affect the limitations period for an action claiming damages resulting from the rescission. (2756)

(k) If the foreclosure sale is rescinded under this section for a reason listed in Subsection (b), other than a stay described by Subsection (b)(6), the court in a civil action filed by the purchaser challenging the effectiveness of the rescission or claiming damages resulting from the rescission may only award as damages to the purchaser the amount of the bid paid for the property by the purchaser at the sale that has not been refunded to the purchaser, plus interest on that amount at the rate of 10 percent per year. Notwithstanding any other law, the court may not order specific performance of the sale as a remedy for the purchaser. Interest awarded under this subsection ceases to accrue on the fourth day after the date the mortgagee deposits the amount of the damages awarded in the United States mail or with a courier for delivery to the purchaser. (2757)

(l) If a foreclosure sale is rescinded under this section for a reason provided by Subsection (b)(6), the court in a civil action filed by the purchaser challenging the effectiveness of the rescission or claiming damages resulting from the rescission may only award as damages to the purchaser the amount of the bid paid for the property by the purchaser at the sale that has not been refunded to the purchaser. (2758)

(m) Nothing in this section prohibits the rescission of a sale by agreement of the affected parties on other terms or a suit to rescind a sale not rescinded under this section. (2759)

Added by Acts 2015, 84th Leg., R.S., Ch. 551 (H.B. 2066), Sec. 1, eff. September 1, 2015. (2760)

CHAPTER 52. JUDGMENT LIEN (2761)(1-click HTML)
Sec. 52.001. ESTABLISHMENT OF LIEN. (2762)(1-click HTML)

Except as provided by Section 52.0011 or 52.0012, a first or subsequent abstract of judgment, when it is recorded and indexed in accordance with this chapter, if the judgment is not then dormant, constitutes a lien on and attaches to any real property of the defendant, other than real property exempt from seizure or forced sale under Chapter 41, the Texas Constitution, or any other law, that is located in the county in which the abstract is recorded and indexed, including real property acquired after such recording and indexing. (2763)

Acts 1983, 68th Leg., p. 3526, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1989, 71st Leg., ch. 1178, Sec. 2, eff. Sept. 1, 1989; Acts 1993, 73rd Leg., ch. 48, Sec. 6, eff. Sept. 1, 1993. (2764)

Amended by: (2765)

Acts 2007, 80th Leg., R.S., Ch. 374 (S.B. 512), Sec. 1, eff. September 1, 2007. (2766)

Sec. 52.0011. ESTABLISHMENT OF LIEN PENDING APPEAL OF JUDGMENT. (2767)(1-click HTML)

(a) A first or subsequent abstract of a judgment rendered by a court against a defendant, when it is recorded and indexed under this chapter, does not constitute a lien on the real property of the defendant if: (2768)

(1) the defendant has posted security as provided by law or is excused by law from posting security; and (2769)

(2) the court finds that the creation of the lien would not substantially increase the degree to which a judgment creditor's recovery under the judgment would be secured when balanced against the costs to the defendant after the exhaustion of all appellate remedies. A certified copy of the finding of the court must be recorded in the real property records in each county in which the abstract of judgment or a certified copy of the judgment is filed in the abstract of judgment records. (2770)

(b) The court may withdraw its finding under Subsection (a)(2) at any time the court determines, from evidence presented to it, that the finding should be withdrawn. The lien exists on withdrawal of the finding and on the filing of a certified copy of the withdrawal of the finding of the court in the real property records in each county in which the abstract of judgment or a certified copy of the judgment is filed in the abstract of judgment records. (2771)

Added by Acts 1989, 71st Leg., ch. 1178, Sec. 3, eff. Sept. 1, 1989. (2772)

Sec. 52.0012. RELEASE OF RECORD OF LIEN ON HOMESTEAD PROPERTY. (2773)(1-click HTML)

(a) In this section: (2774)

(1) "Homestead" has the meaning assigned by Section 41.002. (2775)

(2) "Judgment debtor" and "judgment creditor" have the meanings assigned by Section 31.008(h), Civil Practice and Remedies Code. (2776)

(b) A judgment debtor may, at any time, file an affidavit in the real property records of the county in which the judgment debtor's homestead is located that substantially complies with Subsection (f). (2777)

(c) Subject to Subsection (d) and except as provided by Subsection (e), an affidavit filed under Subsection (b) serves as a release of record of a judgment lien established under this chapter. (2778)

(d) A bona fide purchaser or a mortgagee for value or a successor or assign of a bona fide purchaser or mortgagee for value may rely conclusively on an affidavit filed under Subsection (b) if included with the affidavit is evidence that: (2779)

(1) the judgment debtor sent a letter and a copy of the affidavit, without attachments and before execution of the affidavit, notifying the judgment creditor of the affidavit and the judgment debtor's intent to file the affidavit; and (2780)

(2) the letter and the affidavit were sent by registered or certified mail, return receipt requested, 30 or more days before the affidavit was filed to: (2781)

(A) the judgment creditor's last known address; (2782)

(B) the address appearing in the judgment creditor's pleadings in the action in which the judgment was rendered or another court record, if that address is different from the judgment creditor's last known address; (2783)

(C) the address of the judgment creditor's last known attorney as shown in those pleadings or another court record; and (2784)

(D) the address of the judgment creditor's last known attorney as shown in the records of the State Bar of Texas, if that address is different from the address of the attorney as shown in those pleadings or another court record. (2785)

(e) An affidavit filed under Subsection (b) does not serve as release of record of a judgment lien established under this chapter with respect to a purchaser or mortgagee of real property that acquires the purchaser's or mortgagee's interest from the judgment debtor after the judgment creditor files a contradicting affidavit in the real property records of the county in which the real property is located asserting that: (2786)

(1) the affidavit filed by the judgment debtor under Subsection (b) is untrue; or (2787)

(2) another reason exists as to why the judgment lien attaches to the judgment debtor's property. (2788)

(f) An affidavit filed under Subsection (b) must be in substantially the following form: (2789)

HOMESTEAD AFFIDAVIT AS RELEASE OF JUDGMENT LIEN (2790)

Before me, the undersigned authority, on this day personally appeared __________ ("Affiant(s)") (insert name of one or more affiants) who, being first duly sworn, upon oath states: (2791)

(1) My/our name is/are __________ (insert name of Affiant(s)). I/we own the following described land ("Land"): (2792)

(describe the property claimed as homestead) (2793)

(2) This affidavit is made for the purpose of effecting a release of that judgment lien recorded in __________ (refer to recording information of judgment lien) ("Judgment Lien") as to the Land. (2794)

(3) The Land includes as its purpose use for a home for Affiant(s) and is the homestead of Affiant(s), as homestead is defined in Section 41.002, Property Code. The Land does not exceed: (2795)

(A) 10 acres of land, if used for the purposes of an urban home or as both an urban home and a place to exercise a calling or business; or (2796)

(B) 200 acres for a family or 100 acres for a single, adult person not otherwise entitled to a homestead, if used for the purposes of a rural home. (2797)

(4) Attached to this affidavit is evidence that: (2798)

(A) Affiant(s) sent a letter and a copy of this affidavit, without attachments and before execution of the affidavit, notifying the judgment creditor in the Judgment Lien of this affidavit and the Affiant(s)' intent to file for record this affidavit; and (2799)

(B) the letter and this affidavit were sent by registered or certified mail, return receipt requested, 30 or more days before this affidavit was filed to: (2800)

(i) the judgment creditor's last known address; (2801)

(ii) the address appearing in the judgment creditor's pleadings in the action in which the judgment was rendered or another court record, if that address is different from the judgment creditor's last known address; (2802)

(iii) the address of the judgment creditor's last known attorney as shown in those pleadings or another court record; and (2803)

(iv) the address of the judgment creditor's last known attorney as shown in the records of the State Bar of Texas, if that address is different from the address of the attorney as shown in those pleadings or another court record. (2804)

(5) This affidavit serves as a release of the Judgment Lien as to the Land in accordance with Section 52.0012, Property Code. (2805)

Signed on this _____ day of __________, _____. (2806)

____________________ (2807)

____________________ (2808)

(Signature of Affiant(s)) (2809)

State of __________ (2810)

County of __________ (2811)

SWORN TO AND SUBSCRIBED before me on the _________ day of __________, 20___. (2812)

My commission expires: (2813)

______________________ (2814)

_______________________________ (2815)

Notary Public, State of Texas (2816)

Notary's printed name: (2817)

________________________________ (2818)

Added by Acts 2007, 80th Leg., R.S., Ch. 374 (S.B. 512), Sec. 2, eff. September 1, 2007. (2819)

Sec. 52.002. ISSUANCE OF ABSTRACT. (2820)(1-click HTML)

(a) On application of a person in whose favor a judgment is rendered or on application of that person's agent, attorney, or assignee, the judge or justice of the peace who rendered the judgment or the clerk of the court in which the judgment is rendered shall prepare, certify, and deliver to the applicant an abstract of the judgment. The applicant for the abstract must pay the fee authorized by law for providing the abstract. (2821)

(b) The attorney of a person in whose favor a judgment is rendered in a small claims court or a justice court or a person in whose favor a judgment is rendered in a court other than a small claims court or a justice court or that person's agent, attorney, or assignee may prepare the abstract of judgment. An abstract of judgment prepared under this subsection must be verified by the person preparing the abstract. (2822)

Acts 1983, 68th Leg., p. 3527, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1987, 70th Leg., ch. 663, Sec. 2, eff. Sept. 1, 1987; Acts 1999, 76th Leg., ch. 176, Sec. 1, eff. Sept. 1, 1999; Acts 2001, 77th Leg., ch. 668, Sec. 2, eff. Sept. 1, 2001. (2823)

Sec. 52.003. CONTENTS OF ABSTRACT. (2824)(1-click HTML)

(a) An abstract of a judgment must show: (2825)

(1) the names of the plaintiff and defendant; (2826)

(2) the birthdate of the defendant, if available to the clerk or justice; (2827)

(3) the last three numbers of the driver's license of the defendant, if available; (2828)

(4) the last three numbers of the social security number of the defendant, if available; (2829)

(5) the number of the suit in which the judgment was rendered; (2830)

(6) the defendant's address, or if the address is not shown in the suit, the nature of citation and the date and place of service of citation; (2831)

(7) the date on which the judgment was rendered; (2832)

(8) the amount for which the judgment was rendered and the balance due; (2833)

(9) the amount of the balance due, if any, for child support arrearage; and (2834)

(10) the rate of interest specified in the judgment. (2835)

(b) An abstract of a judgment may show a mailing address for each plaintiff or judgment creditor. (2836)

Acts 1983, 68th Leg., p. 3527, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1991, 72nd Leg., 1st C.S., ch. 15, Sec. 4.08, eff. Sept. 1, 1991; Acts 1993, 73rd Leg., ch. 134, Sec. 2, eff. May 12, 1993. (2837)

Amended by: (2838)

Acts 2007, 80th Leg., R.S., Ch. 143 (S.B. 699), Sec. 2, eff. September 1, 2007. (2839)

Sec. 52.004. RECORDING AND INDEXING OF ABSTRACT. (2840)(1-click HTML)

(a) The county clerk shall immediately record in the county real property records each properly authenticated abstract of judgment that is presented for recording. The clerk shall note in the records the date and hour an abstract of judgment is received. (2841)

(b) At the same time an abstract is recorded, the county clerk shall enter the abstract on the alphabetical index to the real property records, showing: (2842)

(1) the name of each plaintiff in the judgment; (2843)

(2) the name of each defendant in the judgment; and (2844)

(3) the volume and page or instrument number in the records in which the abstract is recorded. (2845)

Acts 1983, 68th Leg., p. 3527, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 2001, 77th Leg., ch. 668, Sec. 2, eff. Sept. 1, 2001. (2846)

Sec. 52.0041. ADDRESS REQUIREMENT FOR RECORDING ABSTRACT. (2847)(1-click HTML)

(a) A judgment abstracted after September 1, 1993, may not be recorded unless: (2848)

(1) a mailing address for each plaintiff or judgment creditor appears on the abstract of judgment; or (2849)

(2) a penalty filing fee equal to the greater of $25 or twice the statutory recording fee for the abstract is paid. (2850)

(b) The validity of an abstracted judgment as between the parties is not affected by a failure to include an address for each plaintiff or judgment creditor in the abstracted judgment. (2851)

(c) Payment of a filing fee and acceptance of the abstract of judgment by a county clerk for recording creates a conclusive presumption that the requirements of this section have been met. (2852)

Added by Acts 1993, 73rd Leg., ch. 134, Sec. 1, eff. May 12, 1993. (2853)

Sec. 52.005. SATISFACTION OF JUDGMENT. (2854)(1-click HTML)

Satisfaction of a judgment in whole or in part may be shown by recordation of: (2855)

(1) a return on an execution issued on the judgment, or a copy of the return, certified by the officer making the return and showing: (2856)

(A) the names of the parties to the judgment; (2857)

(B) the number and style of the suit; (2858)

(C) the court in which the judgment was rendered; (2859)

(D) the date and amount of the judgment; and (2860)

(E) the dates of issuance and return of the execution; or (2861)

(2) a receipt, acknowledgement, or release that is signed by the party entitled to receive payment of the judgment or by that person's agent or attorney of record and that is acknowledged or proven for record in the manner required for deeds. (2862)

Acts 1983, 68th Leg., p. 3528, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 2001, 77th Leg., ch. 668, Sec. 2, eff. Sept. 1, 2001. (2863)

Sec. 52.006. DURATION OF LIEN. (2864)(1-click HTML)

(a) Except as provided by Subsection (b), a judgment lien continues for 10 years following the date of recording and indexing the abstract, except that if the judgment becomes dormant during that period the lien ceases to exist. (2865)

(b) Notwithstanding Section 34.001, Civil Practice and Remedies Code, a judgment in favor of the state or a state agency, as that term is defined by Section 403.055, Government Code, does not become dormant. A properly filed abstract of the judgment continues to constitute a lien under Section 52.001 until the earlier of the 20th anniversary of the date the abstract is recorded and indexed or the date the judgment is satisfied or the lien is released. The judgment lien may be renewed for one additional 20-year period by filing, before the expiration of the initial 20-year period, a renewed abstract of judgment in the same manner as the original abstract of judgment is filed. The renewed judgment lien relates back to the date the original abstract of judgment was filed. (2866)

Acts 1983, 68th Leg., p. 3528, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2867)

Amended by: (2868)

Acts 2007, 80th Leg., R.S., Ch. 11 (S.B. 300), Sec. 1, eff. April 23, 2007. (2869)

Sec. 52.007. FEDERAL COURT JUDGMENT. (2870)(1-click HTML)

An abstract of a judgment rendered in this state by a federal court may be recorded and indexed under this chapter on the certificate of the clerk of the court. (2871)

Acts 1983, 68th Leg., p. 3528, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2872)

SUBCHAPTER B. CANCELLATION OF JUDGMENTS AND JUDGMENT LIENS AGAINST BANKRUPTS--ABSTRACT RECORDED BEFORE SEPTEMBER 1, 1993 (2873)(1-click HTML)
Sec. 52.021. DISCHARGE AND CANCELLATION. (2874)(1-click HTML)

(a) In accordance with this subchapter, a judgment and judgment lien may be discharged and canceled if the person against whom the judgment was rendered is discharged from his debts under federal bankruptcy law. (2875)

(b) This subchapter applies to judgments against persons whose debts are discharged in bankruptcy and for which the abstracts of judgment are recorded before September 1, 1993, as provided by Subchapter A, regardless of the fact that the discharge in bankruptcy occurred before this law took effect. (2876)

Acts 1983, 68th Leg., p. 3529, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1993, 73rd Leg., ch. 313, Sec. 2, eff. Sept. 1, 1993. (2877)

Sec. 52.022. APPLICATION FOR COURT ORDER. (2878)(1-click HTML)

(a) The person who has been discharged from his debts, that person's receiver or trustee, or any other interested person may apply, on proof of the discharge, to the court in which the judgment was rendered for an order discharging and canceling the judgment and judgment lien. (2879)

(b) A person may not apply for the order before a year has elapsed since the bankruptcy discharge. (2880)

Acts 1983, 68th Leg., p. 3529, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2881)

Sec. 52.023. NOTICE OF APPLICATION. (2882)(1-click HTML)

(a) Notice of the application for the order and copies of the papers on which application is made must be served on the judgment creditor or his attorney of record in the action in which the judgment was rendered. (2883)

(b) If the residence or place of business of the judgment creditor or his attorney is known, notice must be served in the manner prescribed for service of notice in an action. (2884)

(c) As an alternative to service under Subsection (b), the court may order that notice of the application be published in a newspaper designated in the order once a week for not more than three consecutive weeks if the applicant proves by affidavit that: (2885)

(1) the address of neither the judgment creditor nor his attorney is known and the address of neither can be ascertained by due diligence; or (2886)

(2) the judgment creditor is not a resident of this state and his attorney is dead, removed from the state, or unknown. (2887)

Acts 1983, 68th Leg., p. 3529, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2888)

Sec. 52.024. COURT ORDER. (2889)(1-click HTML)

(a) The court shall conduct a hearing on the application and shall enter an order of discharge and cancellation of the judgment and any abstracts of the judgment if the debtor or bankrupt has been discharged in bankruptcy from the payment of the obligation or debt represented by the judgment. (2890)

(b) In each county in which the court's order is recorded in the judgment lien records, the order constitutes a release, discharge, and cancellation of the judgment and of any unsatisfied judgment lien represented by an abstract that is of record in the county on the date of the order or is recorded in the county on or after the date of the order. (2891)

Acts 1983, 68th Leg., p. 3530, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2892)

Sec. 52.025. EFFECT ON LIEN OF DISCHARGE OF DEBT IN BANKRUPTCY. (2893)(1-click HTML)

(a) A judgment lien is not affected by the order of discharge and cancellation and may be enforced, if the lien is against real property owned by the bankrupt or debtor before the debtor was adjudged bankrupt or a petition for debtor relief was filed under federal bankruptcy law, and: (2894)

(1) the debt or obligation evidenced by the judgment is not discharged in bankruptcy; or (2895)

(2) the property is nonexempt and is abandoned during the course of the proceeding. (2896)

(b) Except as provided by Subsection (a), the judgment is of no force or validity and may not be a lien on real property acquired by the bankrupt or debtor after the discharge in bankruptcy. (2897)

Acts 1983, 68th Leg., p. 3530, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2898)

SUBCHAPTER C. CANCELLATION OF JUDGMENTS AND JUDGMENT LIENS AGAINST DEBTORS--ABSTRACT RECORDED ON OR AFTER SEPTEMBER 1, 1993 (2899)(1-click HTML)
Sec. 52.041. APPLICATION OF SUBCHAPTER. (2900)(1-click HTML)

This subchapter applies to a judgment and judgment lien for which an abstract of judgment or judgment lien is recorded on or after September 1, 1993. (2901)

Added by Acts 1993, 73rd Leg., ch. 313, Sec. 3, eff. Sept. 1, 1993. (2902)

Sec. 52.042. DISCHARGE AND CANCELLATION. (2903)(1-click HTML)

(a) A judgment is discharged and any abstract of judgment or judgment lien is canceled and released without further action in any court and may not be enforced if: (2904)

(1) the lien is against real property owned by the debtor before a petition for debtor relief was filed under federal bankruptcy law; and (2905)

(2) the debt or obligation evidenced by the judgment is discharged in the bankruptcy. (2906)

(b) A judgment evidencing a debt or obligation discharged in bankruptcy does not have force or validity and may not be a lien on real property acquired by the debtor after the petition for debtor relief was filed. (2907)

Added by Acts 1993, 73rd Leg., ch. 313, Sec. 3, eff. Sept. 1, 1993. (2908)

Sec. 52.043. EXCEPTIONS TO DISCHARGE AND CANCELLATION. (2909)(1-click HTML)

A judgment lien is not affected by this subchapter and may be enforced if the lien is against real property owned by the debtor before a petition for debtor relief was filed under federal bankruptcy law and: (2910)

(1) the debt or obligation evidenced by the judgment is not discharged in bankruptcy; or (2911)

(2) the property is not exempted in the bankruptcy and is abandoned during the bankruptcy. (2912)

Added by Acts 1993, 73rd Leg., ch. 313, Sec. 3, eff. Sept. 1, 1993. (2913)

CHAPTER 53. MECHANIC'S, CONTRACTOR'S, OR MATERIALMAN'S LIEN (2914)(1-click HTML)
Sec. 53.001. DEFINITIONS. (2915)(1-click HTML)

In this chapter: (2916)

(1) "Contract price" means the cost to the owner for any part of construction or repair performed under an original contract. (2917)

(2) "Improvement" includes: (2918)

(A) abutting sidewalks and streets and utilities in or on those sidewalks and streets; (2919)

(B) clearing, grubbing, draining, or fencing of land; (2920)

(C) wells, cisterns, tanks, reservoirs, or artificial lakes or pools made for supplying or storing water; (2921)

(D) pumps, siphons, and windmills or other machinery or apparatuses used for raising water for stock, domestic use, or irrigation; and (2922)

(E) planting orchard trees, grubbing out orchards and replacing trees, and pruning of orchard trees. (2923)

(3) "Labor" means labor used in the direct prosecution of the work. (2924)

(4) "Material" means all or part of: (2925)

(A) the material, machinery, fixtures, or tools incorporated into the work, consumed in the direct prosecution of the work, or ordered and delivered for incorporation or consumption; (2926)

(B) rent at a reasonable rate and actual running repairs at a reasonable cost for construction equipment used or reasonably required and delivered for use in the direct prosecution of the work at the site of the construction or repair; or (2927)

(C) power, water, fuel, and lubricants consumed or ordered and delivered for consumption in the direct prosecution of the work. (2928)

(5) "Mechanic's lien" means the lien provided by this chapter. (2929)

(6) "Original contract" means an agreement to which an owner is a party either directly or by implication of law. (2930)

(7) "Original contractor" means a person contracting with an owner either directly or through the owner's agent. (2931)

(8) "Residence" means a single-family house, duplex, triplex, or quadruplex or a unit in a multiunit structure used for residential purposes that is: (2932)

(A) owned by one or more adult persons; and (2933)

(B) used or intended to be used as a dwelling by one of the owners. (2934)

(9) "Residential construction contract" means a contract between an owner and a contractor in which the contractor agrees to construct or repair the owner's residence, including improvements appurtenant to the residence. (2935)

(10) "Residential construction project" means a project for the construction or repair of a new or existing residence, including improvements appurtenant to the residence, as provided by a residential construction contract. (2936)

(11) "Retainage" means an amount representing part of a contract payment that is not required to be paid to the claimant within the month following the month in which labor is performed, material is furnished, or specially fabricated material is delivered. The term does not include retainage under Subchapter E. (2937)

(12) "Specially fabricated material" means material fabricated for use as a component of the construction or repair so as to be reasonably unsuitable for use elsewhere. (2938)

(13) "Subcontractor" means a person who has furnished labor or materials to fulfill an obligation to an original contractor or to a subcontractor to perform all or part of the work required by an original contract. (2939)

(14) "Work" means any part of construction or repair performed under an original contract. (2940)

(15) "Completion" of an original contract means the actual completion of the work, including any extras or change orders reasonably required or contemplated under the original contract, other than warranty work or replacement or repair of the work performed under the contract. (2941)

Acts 1983, 68th Leg., p. 3533, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1997, 75th Leg., ch. 526, Sec. 2, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 889, Sec. 1, eff. Sept. 1, 1999. (2942)

Sec. 53.002. MORE THAN ONE ORIGINAL CONTRACTOR. (2943)(1-click HTML)

On any work there may be more than one original contractor for purposes of this chapter. (2944)

Acts 1983, 68th Leg., p. 3535, ch. 576, Sec. 1, eff. Jan. 1, 1984. (2945)

Sec. 53.003. NOTICES. (2946)(1-click HTML)

(a) This section applies to notices required by Subchapters B through G and K. (2947)

(b) Any notice or other written communication may be delivered in person to the party entitled to the notice or to that party's agent, regardless of the manner prescribed by law. (2948)

(c) If notice is sent by registered or certified mail, deposit or mailing of the notice in the United States mail in the form required constitutes compliance with the notice requirement. This subsection does not apply if the law requires receipt of the notice by the person to whom it is directed. (2949)

(d) If a written notice is received by the person entitled to receive it, the method by which the notice was delivered is immaterial. (2950)

Acts 1983, 68th Leg., p. 3535, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1997, 75th Leg., ch. 526, Sec. 3, eff. Sept. 1, 1997. (2951)

SUBCHAPTER B. PERSONS ENTITLED TO LIEN; SUBJECT PROPERTY (2952)(1-click HTML)
Sec. 53.021. PERSONS ENTITLED TO LIEN. (2953)(1-click HTML)

(a) A person has a lien if: (2954)

(1) the person labors, specially fabricates material, or furnishes labor or materials for construction or repair in this state of: (2955)

(A) a house, building, or improvement; (2956)

(B) a levee or embankment to be erected for the reclamation of overflow land along a river or creek; or (2957)

  

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