Texas foreclosures happen very quickly. In fact, the state has one of the fastest foreclosure timelines in the country with the average foreclosure lasting just a few months. If you’re a homeowner facing foreclosure in Texas, you should take the time to learn about the state’s foreclosure laws and procedures so you know exactly how much notice you’ll receive before the foreclosure sale occurs, whether you can reinstate the loan before the sale, Texas’ law on deficiency judgments, and more.
Below you’ll find a summary of the basic information that generally applies to most homeowners facing foreclosure in Texas along with citations to the statutes so you can read the law yourself.
The citations to Texas’ foreclosure statutes are: Texas Property Code Section 51.002 through 51.003.
We’ve summarized the key features of Texas’ foreclosure laws below. You can find more detailed articles on various aspects of Texas foreclosure law in Nolo’s Texas Foreclosure Law Center.
The majority of foreclosures in Texas are nonjudicial, which means they happen outside of court. Judicial foreclosures, which go through the court system, are also possible. (Learn more about nonjudicial and judicial foreclosures.) Since foreclosures in Texas are usually nonjudicial, this article focuses on that process.
In Texas, the foreclosing party must give two notices to the defaulting borrower: a notice of default and a notice of sale.
Notice of Default and Intent to Accelerate. The mortgage servicer (the company that handles a borrower’s mortgage account on behalf of the lender) must mail the borrower a Notice of Default and Intent to Accelerate ("accelerate" means to demand that the entire balance of the loan be repaid) that provides at least 20 days to cure the default. Tex. Prop. Code Ann. § 51.002(d).
Notice of Sale. After the cure period expires, and at least 21 days before the foreclosure sale, the servicer then mails a Notice of Sale to each borrower. Tex. Prop. Code Ann. § 51.002(b). The servicer must also post the Notice of Sale at the courthouse door and file it with the county clerk. Tex. Prop. Code Ann. § 51.002(b).
“Reinstating” is when you catch up on the defaulted loan's missed payments (plus fees and costs) in order to stop a foreclosure. (Learn more about reinstatement to avoid foreclosure.)
In Texas, you can cure the default and reinstate the loan within 20 days after the lender serves (mails) the Notice of Default and Intent to Accelerate. Tex. Prop. Code Ann. § 51.002(d).
In some states, you can redeem (repurchase) your home within a certain period of time after the foreclosure. In Texas, however, you cannot redeem your home following a foreclosure. (To get details on redemption after a foreclosure in Texas, see Nolo’s article If I lose my home to foreclosure in Texas, can I get it back?)
When the total mortgage debt exceeds the foreclosure sale price, the difference is called a “deficiency.” Some states allow the lender to seek a personal judgment (called a “deficiency judgment”) against the borrower for this amount, while other states prohibit deficiency judgments with what are called anti-deficiency laws.
In Texas, the lender may obtain a deficiency judgment after a foreclosure. To get a deficiency judgment after a nonjudicial foreclosure, the lender must file a lawsuit within two years after the foreclosure sale. Tex. Prop. Code § 51.003. (For a summary of the deficiency law in Texas, see Texas Laws on Post-Foreclosure Deficiency.)
If the homeowner doesn't vacate the home after a Texas foreclosure sale, the purchaser must give a notice to quit (move out) before initiating an eviction lawsuit (called a forcible detainer action in Texas).