texas property code chapter 51

8/2/2019 Texas Property Code Chapter 51

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PROPERTY CODETITLE 5 . EXEMPT PROPERTY AND LIENS

SUBTITLE B. LIENSCHAPTER 51 . PROVISIONS GENERALLY APPLICABLE TO LIENS

Se c . 5 1 .0 0 0 1 . DEFINITIONS. In t h i s c h a p t e r ,(1) "Book en t ry sys tem" means a n a t i o n a l book en t ry

sys tem fo r r e g i s t e r i n g a b e n e f i c i a l i n t e r e s t in a secu r i tyin s t rument t h a t a c t s as a nominee for the gra n t e e , be ne f i c i a ry ,owner, or ho lder o f the secu r i ty in s t rument and i t s successors anda s s igns .

(2) "Debtor ' s l a s t known address" means:(A) fo r a debt secured by th e deb t o r ' s r e s i d e n c e ,

th e deb t o r ' s r e s i d e n c e a d d r e s s u n le s s th e deb to r p rov ided th emortgage se rv i c e r a wri t t e n change of address befo re the date themortgage s e r v i c e r mai led a n o t i ce req u i r ed by Sec t ion 51 .002 ; o r

(B) fo r a debt o th e r t han a d e b t desc r ibed byParagraph (A) , th e deb t o r ' s l a s t known a d d r e s s as shown by th er e c o r d s o f t h e mortgage s e r v i c e r of the s e c u r i t y i n s t r u m e n t u n le s st he deb to r p rov ided the c u r r e n t mortgage s e r v i c e r a w r i t t e n changeof address be fore th e date th e mortgage s e r v i c e r mai led a n o t i c ereq u i r ed by Se c t i o n 51 .002 .

(3) "Mortgage se rv i ce r " means th e l a s t person to whoma mo r tg ag o r has been i n s t ruc t e d by th e c u r r e n t mortgagee to sendpayments fo r th e debt secured by a s e c u r i t y i n s t ru m en t . A mortgageemay be th e mortgage s e r v i c e r .

(4) "Mor tgagee" means:(A) th e g r a n t e e , b e n e f i c i a r y , owner , or holde r of

a se c ur i t y i n s t r u m e n t ;(B) a book e n t r y sys tem; or(C) i f th e s e c u r i t y i n t e r e s t has been a s s i g n e d of

r eco rd , th e l a s t person to whom th e s e c u r i t y i n t e r e s t has beena s s i g n e d o f r eco rd .

(5) "Mor tgagor" means th e g ran to r o f a s e c u r i t yi n s t ru m en t .

(6) "Secu r i t y i ns t rument" means a deed o f t r u s t ,mortgage , or o th e r con t r ac t l i e n on an i n t e r e s t in r e a l p r o p e r t y .

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(7) " Subs t i t u t e t ru s tee" means a person appointed bythe c ur re n t mortgagee or mortgage se rv ice r under the te rms of thesecu r i ty inst rument to exerc ise the power of s a l e .

(8) "Trus tee" means a person or persons author ized toexerc ise the power of sa le under the te rms of a secu r i ty inst rumentin accordance with Sect ion 51.0074.Added by Acts 2003, 78th Leg. , ch. 554, Sec. 1 , e f f . Jan . 1 , 2004.Amended by:

Acts 2007, 80th Leg. , R.S. , Ch. 90 3 , Sec. 1, e f f . June 15,2007 .

Se c . 5 1 . 0 0 1 . EFFECT ON OTHER LIENS. Ex c e p t as p r o v i d e d byChapter 59, t h i s s ub t i t l e does not a f f e c t :

(1) the r igh t to crea te a l i en by spec ia l c on t ra c t oragr eement; or

(2) a l i en t h a t i s no t t r ea t ed in t h i s s ub t i t l e ,i nc luding a l i en a r i s ing under common law, in e qu i ty , or underano ther s t a tu t e of t h i s s t a t e .Acts 1983, 68th Leg. , p . 3525, ch. 576, Sec. 1 , e f f . Jan . 1 , 1984.

Se c . 5 1 . 0 0 2 . SALE OF REAL PROPERTY UNDER CONTRACT LIEN. (a )A sa le of r e a l prope r ty under a power of sa le confer red by a deed oft r u s t or other c on t ra c t l i en must be a publ ic sa le a t auc t ion heldbetween 10 a.m. an d 4 p.m. of the f i r s t Tuesday of a month. Exceptas prov ided by Subsect ion (h) , the sa le must take place a t thecounty courthouse in the county in which the land i s l oc a t e d , or i fthe proper ty i s loca ted in more than one county , the sa le may bemade a t the courthouse in any county in which the proper ty i sl oc a t e d . The commiss ioners cour t s h a l l designa te the area a t thecourthouse where the sa les are to t ake p l ace an d s h a l l record thedes igna t ion in the r e a l prope r ty records of the county . The sa lemust occur i n the des igna ted a re a . I f no area i s designa ted by thecommiss ioners c our t , the not ice of sa le must designa te the areawhere the sa le covered by t h a t no t i c e i s to take p la c e , an d the sa lemust occur in t h a t a re a .

(b ) Except as provided by Subsect ion (b - l ) , no t i c e of thes a l e , which must i nc lude a s t a t ement of the e a r l i e s t t ime a t which

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the sa le w i l l begin, must be given a t l e a s t 21 days before the dateof the sa le by:

(1) pos t ing a t the cour thouse door of each county inwhich the proper ty i s loca ted a wri t t en not ice des igna t ing thecounty in which the proper ty w i l l be so ld ;

(2) f i l i ng in the of f ice of the county c le rk of eachcounty in which the proper ty i s loca ted a copy of the not i ce postedunder Subdivis ion (1) ; and

(3) serv ing wri t t en not i ce of the sa le by c e r t i f i e dmai l on each debtor who, accord ing to the records of the mortgagese rv icer of the deb t , i s obl iga ted to pay the debt .

I b - I ) I f the cour thouse or county c le rk ' s of f ice i s closedbecause of inclement weather , na tu ra l d i sa s t e r , or other ac t ofGod, a not i ce requi red to be posted a t the cour thouse underSubsect ion (b) (1) or f i l ed with the county c le rk under Subsect ion(b) (2) may be posted or f i l e d , as appropr ia te , up to 48 hours a f t e rthe cour thouse or county c le rk ' s of f ice reopens fo r bus iness , asapp l i cab le .

(c ) The sa le must begin a t the t ime s ta ted in the not ice ofsa le or not l a te r than three hours a f t e r t h a t t ime.

(d ) Notwithstanding any agreement to the cont ra ry , themortgage se r v i ce r of the debt sh a l l serve a debtor i n de f au l t undera deed of t r u s t or other cont rac t l ien on r e a l proper ty used as thedeb tor ' s res idence with wri t t en not ice by c e r t i f i e d mai l s t a t ingt h a t the debtor i s in defau l t under the deed of t r u s t or othercon t r ac t l i en an d giv ing the debtor a t l e a s t 20 days to cure thedefau l t before not ice of sa le can be given under Subsect ion (b) .The en t i r e calendar day on which the not i ce requ i red by th i ssubsec t ion i s given , r ega r d le s s of the t ime of day a t which thenot i ce i s given , i s inc luded in computing the 20-day not i ce per iodrequi red by th i s subsec t ion, an d the en t i r e calendar day on whichnot i ce of sa le i s given under Subsect ion (b) i s excluded incomputing the 20-day not ice per iod.

(e ) Serv ice of a not i ce under th i s sec t ion by c e r t i f i e d mai li s complete when the not i ce i s depos i t ed in the United Sta t e s mai l ,pos tage prepaid an d addressed to the debtor a t the deb tor ' s l a s tknown address . The a f f i d a v i t of a person knowledgeable of the f ac t s

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to the e f fec t t ha t se rvice was completed i s pr im a fac ie evidence ofse rv ice .

(f) Each county c l e rk s h a l l keep a l l no t i c e s f i l ed underSubdiv is ion (2 ) of Subsect ion (b ) in a convenien t f i l e t h a t i sava i l ab le to the publ ic fo r examinat ion dur ing normal businesshours . The c le rk may d ispose of the no t i c e s a f t e r the date of sa lespec i f i ed i n the not ice has passed. Th e c l e rk s h a l l rece ive a feeof $2 fo r each no t i c e f i l e d .

(g ) Th e en t i re ca lendar day on which the not ice of sa le i sgiven, r e ga rd l e s s of the t ime of day a t which the not ice i s g iven ,i s inc luded in computing the 21-day no t i c e per iod requi red bySubsect ion (b ) and the en t i re ca lendar day of the forec losure sa lei s exc luded .

(h ) For the purposes of Subsect ion (a ) , the commissionerscour t of a county may designa te an area other than an a re a a t thecour thouse where sa l e s under t h i s se c t i on w i l l t ake place t h a t i s ina publ ic p l ace within a reasonable proximi ty of the countycour thouse and in a loca t ion as access ib le to the publ ic as thecour thouse door . Th e commissioners cour t s h a l l record t h a tdes igna t ion in the r e a l proper ty records of the county . A sa le maynot be held a t an area designa ted under th i s subsec t ion before the90th day a f t e r the date the des igna t ion i s recorded. Th e pos t ingof the not ice requi red by Subsect ion (b) (1) of a sa le designa tedunder t h i s subsec t ion to t ake place a t an area other than an area ofthe courthouse remains a t the courthouse door of the appropr ia tecounty .Acts 1983, 68th Leg. , p . 3525, ch . 576, Sec. 1 , e f f . Jan . 1 , 1984.Amended by Acts 1984, 68th Leg. , 2nd C.S . , ch . 18, Sec. 3(b ) , e f f .Oct . 2, 1984; Acts 1987, 70th Leg. , ch. 540, Sec. 1 , e f f . Jan. 1 ,1988; Acts 1993, 73rd Leg . , ch . 48, Sec. 5, e f f . Sep t . 1 , 1993;Acts 2003, 78th Leg. , ch . 554, Sec. 2, e f f . Jan . 1 , 2004.Amended by:

2007.

Acts 2005, 79th Leg. , Ch . 53 3 , Sec. 1 , e f f . June 17 , 2005 .Acts 2005, 79th Leg. , Ch . 55 5 , Sec. 1 , e f f . September 1, 2005.Acts 2007, 80th Leg. , R.S. , Ch . 90 3 , Sec. 2 , e f f . June 15,

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Se c . 5 1 .0 0 2 1 . NOTICE OF CHANGE OF ADDRESS REQUIRED. Adeb tor s h a l l inform th e mortgage s e r v i c e r of the debt i n ar e a so n a b l e manner o f any change of address o f t he deb to r fo rpurposes o f p ro v id in g no t i ce to th e deb to r under Sec t ion 51 .002 .Added by Acts 2003, 78th L e g . , ch . 554, Sec . 1 , e f f . Ja n . 1 , 2004.

Se c . 5 1 .0 0 2 5 . ADMINISTRATION OF FORECLOSURE BY MORTGAGESERVICER. A mortgage se rv i c e r may admini s t e r the forec losure ofp r o p e r t y under Se c t i o n 51.002 on b e h a l f o f a mortgagee if:

(1) th e mortgage s e r v i c e r and th e mortgagee haveente red in to an agreement grant ing the c ur re n t mortgage se rv i c e ra u t h o r i t y to se rv i ce th e mortgage ; and

(2 ) the no t ices requi red under Sect ion Sl.002(b)d i sc lose t h a t the mortgage se rv i c e r i s r e p re se n t ing the mortgageeunder a se rv i c ing agreement with the mortgagee and the name of themortgagee and:

(A) the address of the mortgagee; or(B) the address of the mortgage s e r v i c e r , i f

the re i s an agreement grant ing a mortgage se rv i c e r the au tho r i ty tose rvice the mortgage .Added by Acts 2003, 78th Leg. , ch. 554, Sec. 1 , e f f . Jan . 1, 2004.Amended by:

Acts 2005, 79th Leg. , Ch. 555 , Sec. 2, e f f . September 1, 2005.

Se c . 5 1 . 0 0 3 . DEFICIENCY JUDGMENT. (a ) I f t he pr ice a twhich r e a l proper ty i s sold a t a forec losure sa le under Sect ion51.002 i s l e s s than the unpaid balance of the indeb tedness securedby the r e a l prope r ty , re su l t i ng in a def ic iency, any ac t ion broughtto recover the def ic iency must be brought wi thin tw o years of theforec losure sa le an d i s governed by t h i s sec t ion .

(b ) Any person a ga ins t whom such a recovery i s sought bymotion may r eques t t h a t t he cour t in which the ac t ion i s pendingdetermine the f a i r market value of the r e a l prope r ty as of the dateof the forec losure s a l e . The f a i r market value s h a l l be determinedby the f inder of f ac t a f t e r the i n t roduc t ion by the p a r t i e s ofcompetent evidence of the va lue . Competent evidence of value mayinc lude , bu t i s no t l imi ted to , the fol lowing: (1 ) exper t opinion

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test imony; (2 ) comparable sa l e s ; (3 ) an t ic ipa ted market ing t imeand holding c os t s ; (4) cos t of s a l e ; an d (5 ) the neces s i ty andamount of any di scount to be appl i ed to the fu tu re sa les p r i ce orthe cashf low genera ted by the prope r ty t o ar r ive a t a current f a i rmarket va lue .

(c ) I f t he cour t determines t ha t the f a i r market value i sgrea te r than the sa le pr ice of the r e a l proper ty a t the forec losures a l e , t he persons a ga ins t whom recovery of the def ic iency i s soughtare e n t i t l e d to an o f f s e t a ga ins t the def ic iency in the amount bywhich the f a i r market value , l e s s the amount of any c la im,i ndebtedness , or ob l iga t ion of any kind t h a t i s secured by a l i en orencumbrance on the r e a l proper ty t ha t wa s no t ext ingui shed by thefo re c losu re , exceeds the sa le p r i c e . I f no par ty reques ts thedete rmina t ion o f f a i r market value or i f such a reques t i s made andno competent evidence of f a i r market value i s i n t roduced, the sa lepr ice a t the forec losure sa le s h a l l be used to compute thede f i c i e nc y .

(d ) Any money rece ived by a l ender from a pr iva te mortgageguaranty insure r s h a l l be c re d i t e d to the account of the borrowerp r i o r to the lender br inging an ac t ion a t la w fo r any def ic iencyowed by the borrower. Notw iths tanding t he foregoing, the c red i trequi red by t h i s subsec t ion s h a l l no t apply to the exerc ise by ap r i v a t e mortgage guaran ty i n su re r of i t s subroga t ion r igh t s aga ins ta borrower or other person l i ab l e fo r any de f i c i e nc y .Added by Acts 1991, 72nd Leg. , ch. 12, Sec. 1, e f f . Apr i l 1 , 1991.

Sec. 5 1 . 0 0 4 .sec t ion appl ies i f :

JUDICIAL FORECLOSURE--DEFICIENCY. (a ) This

(1) r e a l proper ty subjec t to a deed of t r u s t or otherc on t ra c t l i en i s sold a t a forec losure sa le under a cour t judgmentfo re c los ing the l i en an d order ing the s a l e ; an d

(2) the pr ice a t which the r e a l prope r ty i s sold i sl e s s than the unpaid balance of t he indebtedness secured by the r e a lprope r ty , re su l t i ng in a def i c iency.

(b ) Any person obl iga ted on the i ndebtedness , inc luding aguarantor , may br ing an ac t ion in the d i s t r i c t cour t in the countyin which the r e a l proper ty i s loca ted fo r a dete rmina t ion of the

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f a i r marke t va l ue of th e r e a l p r o p er ty as of the da te of th ef o r ec lo s u r e s a l e . The s u i t must be br ough t no t l a t e r than th e 90thday a f t e r t h e d a t e of th e f o r ec lo s u r e sa le u n les s th e s u i t i sbr ough t by a g u a r a n t o r wh o d id n o t r ece iv e a c t u a l n o t i c e of th e s a l eb e f o r e th e d a t e of s a l e , in which case th e s u i t m u st be br ough t byt h e g u a r a n t o r n o t l a t e r than th e 90th day a f t e r t h e d a t e t h eg u a r a n t o r r e c e i v e d a c t u a l n o t i c e of the s a l e . The f a i r marke t va lues h a l l be de te rmined by the f i n d e r of f a c t a f t e r th e i n t r o d u c t i o n byth e p a r t i e s o f competent evidence of th e v a l u e . Competent evidenceo f va l ue ma y i n c l u d e :

(1) e x p e r t o p i n i o n t e s ti m o n y ;(2) comparable s a l e s ;(3) a n t i c i p a t e d m a r ke t i ng t ime and h o l d i n g c o s t s ;(4) c o s t of s a l e ; and(5) th e n eces s i t y and amount of any d i sc o u n t t o be

ap p l i ed t o th e f u tu r e s a l e s p r i ce or th e cash f low g e n e r a t e d by th ep r o p er ty t o a r r i v e a t a f a i r ma rke t va l ue a s o f th e da te o f thef o r ec lo s u r e s a l e .

(c) I f th e f i n d e r o f f a c t de t e r m i ne s t h a t th e f a i r marke tva l ue i s g r e a t e r than th e s a l e p r i c e of the r e a l p r o p er ty a t th ef o r ec lo s u r e s a l e , th e pe r s ons o b l i g a t e d on t h e i n d e b t e d n e s s ,i n c lu d in g g u a r an to r s , a re e n t i t l e d to an o f f s e t a g a i n s t th ed e f i c i e n c y i n t h e amount by which th e f a i r ma rke t v a l u e , l e s s th eamount o f any c l a i m , i n d e b t e d n e s s , or o b l i g a t i o n of any kind t h a t i ssecured by a l i en or encumbrance on th e r e a l p r o p er ty t h a t was n o te x t i n g u i sh e d by th e f o r e c l o s u r e , exceeds th e s a l e p r i c e . I f nocompetent evidence o f f a i r ma rke t va l ue i s i n t r o d u c e d , t h e s a l ep r i c e a t th e f o r ec lo s u r e s a l e s h a l l be use d to compute th ed e f i c i e n c y .

(d ) An y money r e c e i v e d by a l e n d e r from a p r i v a t e mortgageg u a r a n t y i n s u r e r s h a l l be c red i t ed t o the account o f th e borrowerb e f o r e t h e lender b r in g s an ac t io n a t la w fo r any d ef i c i en cy owed byth e bor rower . However , th e c r e d i t r eq u i r ed by t h i s su b se c t i o n doesno t a pp l y to th e ex e r c i s e by a p r i v a t e mortgage guaran ty i n s u r e r ofits su b r o g a t i o n r i g h t s a g a i n s t a bor rowe r or o t h e r pe r s on l i a b l efo r any d e f i c i e n c y .Added by Ac ts 1991, 72nd L e g . , ch . 361, Se c . 1 , e f f . June 5 , 1991.

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Sec. 51.005. JUDICIAL OR NONJUDICIAL FORECLOSURE AFTERJUDGMENT AGAINST GUARANTOR--DEFICIENCY. (a ) This sect ion appl iesi f :

(1) t h e h o l d e r of a d e b t o b ta in s a co u r t judgmenta g a i n s t a guaran to r o f t he deb t ;

(2 ) r e a l proper ty subjec t to a deed of t r u s t or otherc o n t r a c t l i e n s ecu r in g th e gua ran teed d e b t i s so ld a t a fo rec lo s u res a l e under Se c t i o n 51.002 or under a co u r t judgment fo r ec l os i ng th el i e n and orde r ing the s a l e ;

(3 ) the pr ice a t which the r e a l prope r ty i s sold i sl e s s t han the unpa id ba lance of t h e i n d e b t e d n e s s secured by th e r e a lp r o p e r t y , r e s u l t i n g in a d e f i c i e n c y ; and

(4) a motion or s u i t to de te rmine th e f a i r marke t va lueof the r e a l p ro p e r ty as of the da te of th e f o r e c l o s u r e sa l e has n o tbeen f i l e d under Sec t ion 51.003 or 51 .004 .

(b ) The guarantor may br ing an ac t ion in the d i s t r i c t cour tin the county in which the r e a l proper ty i s located fo r adete rmina t ion of the f a i r market value of the r e a l proper ty as ofthe date of the forec losure sa l e . The s u i t must be brought notl a t e r than the 90th day a f te r t he da te of the forec losure sa le orthe date the guarantor rece ives ac tua l not ice of the forec losures a l e , whichever i s l a t e r . The f a i r market value s h a l l be determinedby the f inder of f ac t a f te r the in t roduct ion by the par t i e s ofcompetent evidence of the va lue . Competent evidence of value mayinc lude :

(1 ) exper t opinion tes t imony;(2 ) comparable sa l e s ;(3 ) an t ic ipa ted market ing t ime an d holding cos t s ;(4 ) cos t of sa l e ; an d(5 ) the necess i ty and amount of any di scount to be

applied to the fu ture sa les p r i ce or the cash f low genera ted by theprope r ty to a r r ive a t a f a i r market value as of the da te of theforec losure sa l e .

(c ) I f the f inder of fac t determines t h a t the f a i r marketvalue i s gre a t e r than the sa le p r i ce of the r e a l proper ty a t theforec losure s a l e , the persons obl iga ted on t he indebtedness ,

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inc lud ing guaran tors , a re e n t i t l e d to an o f f s e t ag a i n s t th ed e f i c i en cy i n th e amount by which th e f a i r marke t value , l e s s th eamount of any cla im, indeb tedness , or obl iga t ion of any kind t h a t i ssecured by a l i en or encumbrance on th e r e a l proper ty t h a t wa s notex t ingu ished by the f o r ec losur e , exceeds th e sa l e p r i c e . I f nocompetent evidence of f a i r market value i s in t roduced , th e sa lepr i ce a t the fo rec l o s u re sa l e sh a l l be used to compute th ede f i c i ency .

(d ) Any money rece ived by a l ender from a pr iva t e mortgageguaran ty i n s u re r sh a l l be credi ted to the account of th e borrowerbefore the lender br ings an ac t ion a t la w fo r any def ic iency owed bythe bor rower . However, th e c r e d i t requ i red by t h i s subsect ion doesnot apply to th e exerc i se by a pr iva t e mortgage guaran ty i nsur e r ofi t s subrogat ion r i g h t s aga ins t a borrower or other person l i ab lefo r any de f i c i ency .Added by Acts 1991, 72nd Leg. , ch. 361, Sec. 1 , e f f . June 5, 1991.

Sec. 51 .006 . DEED-OF-TRUST FORECLOSURE AFTER DEED IN LIEUOF FORECLOSURE. (a ) This sec t ion app l i e s to a holder of a debtunder a deed of t r u s t who accep t s from th e debtor a deed conveyingr e a l p ro p e r t y s u b j ec t to the deed of t r u s t in sa t i s f a c t i o n of th edeb t .

(b ) Th e holder of a debt may void a deed conveying r e a lp ro p e r t y in sa t i s f a c t i o n of the debt before the four th ann iversaryof th e date th e deed i s executed and fo rec losed under th e o r i g i n a ldeed of t r u s t i f :

(1) th e debtor f a i l s to di sc lose to th e ho lder o f th edeb t a l i en or other encumbrance on th e proper ty before execu t ingthe deed conveying th e p ro p e r t y to th e ho lder of the debt insa t i s f a c t i o n of the deb t ; and

(2) th e holder of th e debt has no p e r s o n a l knowledge ofthe und isc losed l i en or encumbrance on th e pr ope r ty .

(c ) A t h i rd pa r ty may conclus ive ly r e ly upon th e a f f i d a v i tof the ho lder of a debt s t a t i n g t h a t the ho lder has voided th e deedas p rov ided in t h i s sec t ion .

(d ) I f the ho lder e l e c t s to void a deed in l i eu offo rec l o s u re as provided in t h i s s e c t i o n , th e p r io r i t y of i t s deed of

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t r u s t s h a l l n o t be a f f e c t e d or impa i red by th e execu t ion o f th e deedin l i e u o f f o r e c l o s u r e .

(e) I f a holde r accep t s a deed in l i e u o f f o r e c l o s u r e , th eh o l d e r may f o r e c l o s e its deed o f t r u s t as p rov ided i n s a id deed oft r u s t w i t h o u t e l e c t i ng to void th e deed . The p r i o r i t y o f such deedo f t r u s t s h a l l n o t be a f f ec t ed or impa i red by th e deed in l i e u off o r e c l o s u r e .Added by Acts 1995 , 74th L e g . , ch . 1 0 2 0 , Se c . 1 , e f f . Aug. 28 , 1 9 9 5 .

S e c . 5 1 . 0 0 7 . TRUSTEE UNDER DEED OF TRUST, CONTRACT LIEN ORSECURITY INSTRUMENT. (a) The t r u s t e e named in a s u i t or proceed ingmay p lead i n th e answer t h a t th e t r u s t e e i s n o t a n eces s a ry p a r t y bya v e r i f i e d d e n i a l s t a t i n g th e b a s i s fo r t he t r u s t e e ' s reasonab leb e l i e f t h a t th e t r u s t e e was named as a p a r t y s o l e l y in th e cap ac i t yas a t r u s t e e under a deed o f t r u s t , con t r ac t l i e n , o r s e c u r i t yi n s t ru m en t .

(b ) With in 30 days a f t e r th e f i l i n g o f th e t r u s t e e ' sv e r i f i e d d e n i a l , a v e r i f i e d re sponse i s due from al l p a r t i e s t o thes u i t or proceed ing s e t t i n g f o r t h all m a t t e r s , whether in law orf a c t , t h a t r e b u t t h e t r u s t e e ' s v e r i f i e d d e n i a l .

(c) I f a p a r t y has no o b j e c t i o n o r f a i l s to f i l e a t i m e l yv e r i f i e d re sponse to th e t r u s t e e ' s v e r i f i e d d e n i a l , th e t r u s t e es h a l l be di smissed from th e s u i t or proceed ing wi thou t p r e j u d i c e .

(d ) I f a r e s p o n d e n t f i l e s a t im e ly v e r i f i e d re sponse to th et r u s t e e ' s v e r i f i e d d e n i a l , t he ma t t e r s h a l l be s e t fo r h ea r in g . Theco u r t s h a l l di smiss the t r u s t e e from th e s u i t or proceed ing wi thou tpre j ud i ce if th e co u r t d e t e r m i n e s t h a t th e t r u s t e e i s n ot an eces s a ry p a r t y .

and(e )

(d )A d i s m i s s a l of th e t r u s t e e p u r su a n t t o Subsec t ions (c)

s h a l l n ot pre j ud i ce a p a r t y ' s r i g h t to seek i n j unc t i ver e l i e f t o p rev en t th e t r u s t e e from proceed ing wi th a fo rec lo s u res a l e .

( f) A t r u s t e e s h a l l n o t be l i a b l e fo r any good f a i t h e r r o rr e s u l t i n g from r e l i a n c e on any i n fo rma t ion in law or f a c t prov idedby th e mor tgagor o r mor tgagee or t h e i r r e spec t i ve a t t o rney , a g e n t ,o r r e p r e s e n t a t i v e or o th e r t h i r d p a r t y .Added by Acts 1999 , 76th L e g . , ch . 1304 , Sec . 1 , e f f . Se p t . 1 , 1 9 9 9 .

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Sec. 51 . 0074 . DUTIES OF TRUSTEE. (a ) One or more personsmay be author ized to exerc i se the power of sa le under a secu r i tyi ns t rument .

(b) A t r u s t e e ma y n o t be :(1) ass igned a duty under a secu r i ty in s t rument o ther

than to exe rc i se the power of sa le in accordance with the te rms ofthe s e c u r i t y i n s t ru m en t ; or

(2) h e l d to th e ob l i ga t i ons o f a f i d u c i a r y of th emo r tg ag o r or mortgagee .Added by Acts 2007, 80th Leg . , R.S . , Ch . 90 3 , Sec. 3 , e f f . June 15 ,2007.

Sec. 51 .0075 . AUTHORITY OF TRUSTEE OR SUBSTITUTE TRUSTEE.(a) A t r u s t e e or subs t i t u t e t ru s t ee may s e t reasonab le condi t ionsfo r c o n d u c t i n g th e p u b l i c sa l e if th e co n d i t i o n s a re announcedbefore b idding i s opened for the f i r s t sa le of the day held by thet r u s t e e or s u b s t i t u t e t r u s t e e .

(b ) A t r u s t e e or s u b s t i t u t e t r u s t e e i s n ot a deb t c o l l e c t o r .(c) Notwi ths t and ing any agreement to th e c o n t r a r y , a

mortgagee may a p p o i n t or ma y au thor i z e a mortgage s e r v i c e r toa p p o i n t a s u b s t i t u t e t r u s t e e or s u b s t i t u t e t r u s t e e s to succeed toal l title, p o wers , and d u t i e s of th e or i g i n a l t r u s t e e . A mortgageeo r mortgage s e r v i c e r may make an appoin tment or au t hor i za t i on undert h i s subsec t ion by power o f a t t o r n e y , c o r p o r a t e r e s o l u t i o n , oro th e r w r i t t e n i n s t ru m en t .

(d ) A mortgage s e r v i c e r ma y au th o r i ze an a t t o rney to appo in ta s u b s t i t u t e t r u s t e e or s u b s t i t u t e t r u s t e e s on b e h a l f o f amortgagee under Subsec t ion ( c ) .

(e) The name and a s t r e e t address fo r a t r u s t e e ors u b s t i t u t e t r u s t e e s s h a l l be d i s c lo s ed on th e n o t i ce r eq u i r ed bySe c t i o n 51.002 Ib) .

( f) The p u r c h a s e p r i c e in a sa l e he ld by a t r u s t e e ors u b s t i t u t e t r u s t e e under t h i s sec t i on i s due and payab le wi thou td e l a y on a c c e p t a n c e o f th e b id o r wi th in such r e a so n a b l e t ime as ma ybe agreed upon by t h e p u r c h a se r and th e t r u s t e e o r s u b s t i t u t et r u s t e e if t h e p u r c h a se r makes such r eq u es t fo r a d d i t i o n a l t ime to

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d e l i v e r th e purchase p r i c e . The t r u s t e e or s u b s t i t u t e t r u s t e es h a l l d i s b u r s e th e p r o c e e d s o f th e sa l e as prov ided by l aw.Added by Acts 2003, 78th L e g . , ch . 554, Sec . 1 , e f f . Ja n . 1 , 2004.Amended by:

Acts 2005 , 79th L e g . , Ch. 1231 , Sec . 1, e f f . September 1 ,2005 .

Acts 2007, 80th Leg . , R . S . , Ch. 903 , Sec. 4 , e f f . June 1 5 ,2007 .

Acts 2009, 8 1 s t L e g . , R . S . , Ch. 323 , Sec . 1, e f f . September 1 ,2009 .

Sec . 51 . 008 . CERTAIN LIENS ON REAL PROPERTY. (a ) A l i e n onr e a l p ro p e r ty c r e a t e d under t h i s code or ano the r law of t h i s s t a t ein f a v o r o f a governmenta l e n t i t y must be recorded a s p rov ided byC h a p t e r s 11 and 12 in th e r e a l p ro p e r ty r e c o r d s of th e county inwhich th e p ro p e r ty or a p o r t i o n of the p ro p e r ty i s l o ca t ed u n l e s s :

(1) th e l i e n i s imposed as a r e s u l t of f a i l u r e to pay:(A) ad valorem t a x e s ; or(B) a pena l t y or i n t e r e s t owed in connec t ion wi th

those t a x e s ; or(2) th e law e s t a b l i s h i n g th e l i e n ex p re s s ly s t a t e s

t h a t r eco rd in g th e l i e n i s n o t r e q u i r e d .(b ) An y no t i ce of the l i e n r eq u i r ed by law m u st co n t a in a

l e g a l desc r i p t i on of th e prope r t y .(c) This sec t i on does n o t a p p l y to :

(1) a l i e n c r e a t e d under Se c t i o n 8 9 . 0 8 3 , N a t u r a lResources Code;

Code .

(2) a s t a t e ta x l i e n under Chapter 113 , Tax Code; o r(3) a l i e n e s t a b l i s h e d under Chapter 61 o r 213, Labor

Added by Acts 2001, 77th L e g . , ch . 827 , Sec. 1 , e f f . Se p t . 1 , 2001.

Se c . 5 1 . 0 0 9 . FORECLOSED PROPERTY SOLD "AS I S " . A p u r c h a s e ra t a sa l e o f r e a l p r o p e r t y under Se c t i o n 51 .002 :

(1) acq u i r e s th e fo rec lo s ed p ro p e r ty "as i s " w i t h o u tany expres sed or impl i ed w a r r a n t i e s , e x c e p t as t o w a r r a n t i e s oftitle, and a t th e p u r c h a s e r ' s own r i s k ; and

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(2) i s n o t a consumer .Added by Acts 2003, 78th L e g . , ch . 554, Sec . 1 , e f f . Ja n . 1 , 2004.

Sec. 51 .015 . SALE OF CERTAIN PROPERTY OWNED BY MEMBER OF THEMILITARY. (a) In t h i s sec t i on :

(1) "Ac t ive duty m i l i t a r y s e rv i ce" means:(A) s e rv i ce as a member o f th e armed fo rce s o f th e

Uni ted S t a t e s ; and(B) wi th r e s p e c t to a member of th e Texas

N a t i o n a l Guard or t h e N a t i o n a l Guard of ano the r s t a t e or a member ofa r e s e rv e component o f th e armed fo rce s o f th e Uni ted S t a t e s , a c t i v eduty under an orde r o f th e p r e s i d e n t o f th e Uni ted S t a t e s .

(2 ) "Dwel l ing" means a r e s i d e n t i a l s t r u c t u r e ormanufac tu red horne t h a t co n t a in s one to four fami ly hous ing u n i t s .

(3) "M i l i ta ry servicemember" means:(A) a member of th e armed fo rce s of th e Uni ted

S t a t e s ;(B) a member of th e Texas N a t i o n a l Guard or th e

N a t i o n a l Guard of a n o t h e r s t a t e s e rv in g on ac t i ve duty under ano r d e r of th e p r e s i d e n t of the Uni ted S t a t e s ; or

(C) a member of a r e s e rv e component o f t h e armedfo rce s o f t h e Uni ted St a t e s wh o i s on ac t i ve duty under an orde r ofth e p r e s i d e n t of th e Uni ted S t a t e s .

(4) "Person" has th e meaning ass igned by Sec t ion311 .005 , Government Code.

(b ) This sec t i on app l i e s only to an o b l i g a t i o n :(1) t h a t i s secured by a mortgage , deed o f t r u s t , or

o th e r con t r ac t l i e n on r e a l p ro p e r ty or p e r s o n a l p ro p e r ty t h a t i s adwel l ing owned by a m i l i t a r y se rv i cememb er ;

(2) t h a t o r i g i n a t e s b e fo re th e date on which th eservicemember ' s ac t i ve duty m i l i t a r y se rv i ce commences; and

(3) fo r which th e servicemember i s still o b l i g a t e d .(c) In an ac t i on f i l e d dur ing a m i l it a r y se rv icemember ' s

p e r io d o f ac t i ve duty m i l it a r y se rv i ce o r dur ing the n i n e monthsa f t e r th e date on which t h a t s e rv i ce p e r i o d conc ludes t o fo rec lo s e al i e n or othe rwise enforce an ob l i ga t i on d es c r ib ed by Subsec t ion(b ) , th e co u r t may a f t e r a h ea r in g and on th e c o u r t ' s ow n mot ion ,

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and s h a l l on th e ap p l i ca t i o n by a servicemember whose a b i l i t y tocomply wi th th e o b l i g a t i o n s of th e co n t r ac t s e c u r e d by th e l i en i sm a t e r i a l l y a f f ec t ed by th e se rv icemember ' s m i l i t a r y s e rv i ce :

(1) s t ay th e pr oc e e d i ngs fo r a p er io d of t ime a sj u s t i c e and eq u i ty r eq u i r e ; or

(2) a d j u s t th e o b l i g a t i o n s of the c o n t r a c t s e c u r e d byth e l i en to p r e se r v e th e i n t e r e s t s of al l p a r t i e s .

(d ) A s a l e , fo rec l o s u re , or s e i zu r e o f p r o p e r ty under amor tgage , deed o f t r u s t , or o t h e r c o n t r a c t l i en d e sc r i b e d bySubsec t ion Ib ) may no t be conduc ted d u r i n g t h e m i l i t a r yse rv icemember ' s p er io d o f ac t i v e du t y m i l i t a r y s e r v i c e or dur ingth e n i ne months a f t e r th e da te on which t h a t s e r v i ce p e r io dconc ludes u n l e s s t h e s a l e , fo rec l o s u re , or s e i zu r e i s conductedunder :

(1) a c o u r t o r d e r i s su e d b e f o r e t h e s a l e , fo rec l o s u re ,or s e i z u r e ; or

(2) an ag reemen t t h a t compl i es wi t h S ubs e c t i on ( e ) .(e) A m i l i t a r y servicemember may waive the se rv icemember ' s

r i g h t s under t h i s s e c t i o n on l y a s p r ov i de d by t h i s s u b s ec t io n . Thewaiver must be :

(1) i n w r i t i n g i n a t l e a s t 1 2 - p o i n t t y p e ;(2) executed as an i n s t r u m e n t s e p a r a t e from th e

o b l i g a t i o n to which th e waiver a p p l i e s ; and(3) made under a w r i t t e n ag reemen t :

(A) executed d u r i n g or a f t e r th e se rv icemember ' sp er io d o f ac t i v e duty m i l i t a r y s e r v i c e ; and

(B) s p ec i f y in g th e l e g a l i n s t r u m e n t to which th ewaiver a p p l i e s and, if th e servicemember i s n o t a p a r t y t o thei n s t r u m e n t , t h e servicemember concerned .

( f) A pe r s on commits an o f f e n se if t h e p e r so n knowinglymakes or causes to be made a s a l e , fo rec l o s u re , or s e i z u r e ofp r o p e r ty t h a t i s p ro h i b i t ed by S ubs e c t i on (d ) .t h i s su b se c t i o n i s a C l a s s A misdemeanor .

An o f f e n se under

(g ) On ap p l i ca t i o n to a co u r t , a dependen t of a m i l i t a r yservicemember i s e n t i t le d t o the p r o t e c t i o n s of t h i s s ec t i o n if th edependent ' s a b i l i t y to comply wi th an o b l i g a t i o n t h a t i s s e c u r e d bya mor tgage , deed o f t r u s t , or o t h e r co n t r ac t l i e n on r e a l p r o p e r ty

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or p er s o n a l p r o p e r ty t h a t i s a dwel l ing i s m a t e r i a l l y a f f ec t ed byth e serv icemember ' s m i l i t a r y s e r v i c e .

(h ) A c o u r t t h a t i s s u e s a s t ay or t ak es any o t h e r a c t i o nunder t h i s s e c t i o n r e g a r d i n g th e en fo rcemen t of an o b l i g a t i o n t h a ti s sub j ec t t o t h i s s ec t i o n ma y g r an t a s i mi l a r s t ay or t ake s i m i l a rac t i o n wi th r e s p e c t to a s u re t y , g u ar an to r , e n d o r se r , accommodationmaker , comaker , or othe r pe rson wh o i s or may be p r i mar i l y ors eco n d ar i l y s u b j ec t to th e o b l i g a t i o n .

( i ) I f a judgment or decree i s vaca ted or s e t a s i d e whol ly orp a r t l y under t h i s s ec t i o n , t h e c o u r t ma y a l s o s e t as id e or v a c a t e ,a s ap p l i cab l e , th e judgment or de c r e e w i t h r e s p e c t to a s u r e t y ,g u a r an to r , e n d o r se r , accommodation maker , comaker , or o t h e r pe r s onwh o i s or ma y be p r imar i l y or secondar i l y sub j e c t t o the o b l i g a t i o nt h a t i s sub j ec t t o th e judgment or d e c r e e .

( j ) This s ec t i o n does n o t p r e v e n t a waiver in w r i t i n g by as u r e t y , g u ar an to r , e n d o r se r , accommodation maker , comaker , oro t h e r p e r so n , whether p r i mar i l y or s eco n d ar i l y l i a b l e on ano b l i g a t i o n , of th e p r o t e c t i o n s pr ov i de d under Subsec t ions (h ) and( i ) A waiver d e sc r i b e d by t h i s su b se c t i o n i s e f f e c t i v e only if iti s executed a s an i n s t r u m e n t s ep a r a t e from th e o b l i g a t i o n wi t hr e s p e c t to which it a p p l i e s . I f a waiver under t h i s s u b s ec t io n i sexecuted by an i n d i v i d u a l wh o a f t e r t he execu t ion o f th e waiveren t e r s ac t i v e du t y m i l i t a r y s e r v i c e , or by a dependen t o f ani n d i v i d u a l wh o a f t e r t he ex ecu t ion of the waiver e n t e r s ac t i v e dutym i l i t a r y s e r v i c e , th e waiver i s n o t v a l i d a f t e r th e be g i nn i ng o f th ep er io d of the ac t i v e duty m i l i t a r y s e r v i ce u n l e s s t h e waiver wasexecuted by th e i n d i v i d u a l or dependen t dur ing the ap p l i cab l ep e r io d d e sc r i b e d by 50 U.S.C. App. Sec t ion 516 , a s t h a t s e c t i o ne x i s t e d on January 1, 2009.Added by Acts 2009, 8 1 s t L e g . , R. S . , Ch. 99 2 , Sec . 1 , e f f . June 19 ,2009.

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