Texas Property Code 51.006 – Deed-of-Trust Foreclosure After Deed in Lieu of Foreclosure
Current as of: 2024 | Check for updates
|
Other versions
(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.
(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:
(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
(2) the holder of the debt has no personal knowledge of the undisclosed lien or encumbrance on the property.
Terms Used In Texas Property Code 51.006
- 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.
- Property: means real and personal property. See Texas Government Code 311.005
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
(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.
(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.
(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.