The Big Question
Can your homestead in Texas be confiscated by a creditor?
After a verdict is rendered by a judge or jury in a civil court case, a final recording (or “judgment”) is made. The court then orders the debtor to pay the creditor. If the debtor doesn’t pay, then the creditor files a lien, which allows him or her to be paid by the proceeds of the sale of the debtor’s property. Does this include the debtor’s homestead in Texas?
The Good News
Texas law considers a homestead to be exempt real property, so The Texas Property Code (Sec. 52.0012) allows a homeowner to self-release a judgment lien against his or her homestead by following the exact procedure outlined in the law, thus protecting your Texas homestead. (This law went into effect on September 1, 2007, so it only applies to abstracts of judgment that are filed after this date.)
The Challenges
Unfortunately, the filing of an abstract of judgment by a creditor complicates the property title, which can affect the debtor who seeks to refinance or sell the property, especially if the title company chooses not to honor the debtor’s affidavit that is executed in the self-release process!
So, as the debtor in this case, you MUST find a title company that is willing to honor your seller’s affidavit!
The Next Step
After consulting with your attorney, you may wish to contact the creditor or his/her attorney to clarify that the lien has been filed against your homestead. You or your attorney can formally demand that the creditor defer to the self-release. This creates a liability for the creditor; and if this is understood, perhaps the creditor will cooperate. However, often the creditor is not willing to cooperate. This is the reasoning behind Section 52.0012.
The Procedures
If the creditor does not provide a partial release of the lien against the homestead, Sec. 52.0012 section (b) explains that a judgment debtor may file an affidavit and a certificate of mailing in the county in which his or her homestead is located. The law is very specific about the procedures that must be followed, so we recommend that you consult with your real estate attorney in order to make sure that you follow the correct process to the letter.
Gaylene Rogers Lonergan
Lonergan Law Firm, PLLC
12801 North Central Expressway, Suite 150, Dallas, Texas 75243
214-503-7509 | lonerganlaw.com | grogers@lonerganlaw.com
© Gaylene Rogers Lonergan and Lonergan Law Firm, PLLC, 2024. All rights reserved. This article is provided for educational reasons exclusively and is not meant to be construed as legal advice. The Lonergan Law Firm, PLLC, will represent you only after being retained and that agreement is made in writing.
