Texas Government Code 1505.111 – Execution of Indenture or Deed of Trust
(a) Before an obligation issued under this subchapter is offered for sale, the mayor and the municipal treasurer or finance commissioner, if authorized by an ordinance adopted by the governing body of the municipality, may execute an indenture or deed of trust that:
(1) makes effective the mortgage lien on any property pledged to secure payment of the principal of and interest on the obligation; and
(2) names a bank or banking institution with trust powers.
(b) The indenture or deed of trust may provide for a grant to a purchaser, under sale or foreclosure, of a franchise to operate the encumbered property for a term not to exceed 20 years from the date of purchase, subject to Subsection (c) and to all laws regulating the same then in force.
Terms Used In Texas Government Code 1505.111
- Deed: The legal instrument used to transfer title in real property from one person to another.
- Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
- Lien: A claim against real or personal property in satisfaction of a debt.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Property: means real and personal property. See Texas Government Code 311.005
(c) The municipality may, at any five-year period within the 20-year term, repurchase the property designated in the franchise under reasonable terms and at a reasonable price, as stated in the encumbrance. This subsection does not apply to any land or property in a reclaimed area that is acquired from the municipality by an individual purchaser.
(d) The indenture or deed of trust shall be recorded in the deed of trust and mortgage records of each county in which any of the indentured property is located.