Foreclosure Steps in Texas

Started by TiffanyC • 8 replies • 2764 views

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TiffanyC (Texas)
Posts: 3

Posted:

I was wondering if anybody here knew the foreclosure proceedings in Texas. I live in a small, poor HOA, and we wanted to try an do this ourselves to save as much money as possible, if possible. We currently have over $70K owed to us by about 20 different families. They have since moved and abandoned the property. Some continue to pay the taxes on their land, but refuse to pay us. We have sent out several certified letters requesting the monies be paid, but to almost no avail. We did get one lot turned over to us in lieu of cash, and another setup a payment plan. Does anybody know the steps we must go through to institute a formal foreclosure on the properties?

TiffanyC (Texas)
Posts: 3

Posted:

Ok so in the course of my further research, I have found in section 209 and 204 of the property code that an assessment lien needs to be filed. Would this be filed with the county attorney?

MicheleD (Kentucky)
Posts: 4,491

Posted:

Check with your county clerk. That's who handles and records deeds and liens in our county.

It might be a good idea to go down in person and have them show you around and they can point you in the directions in which you need to go.

MikeF4 (Texas)
Posts: 26

Posted:

Foreclosure by an HOA is a tricky process. The homeowner has a 180 day right of rescission (hope thats spelled right) and during that time the HOA gets to pay the mortgage, insurance, upkeep, etc... Then in the end the mortgage companies will take any money earned from the sale of the house. Unless you know they have plenty of equity, dont even bother with foreclosure.

Liens are easy. County clerk is the place to visit. Just get a copy of a lien filed by another HOA and type out a similar copy on your own, then take it down for filing. =)

Good luck.

www.silveradohoa.com

MikeF4 (Texas)
Posts: 26

Posted:

Oops, I should have said "foreclosure by an HOA in Texas is a tricky process"

www.silveradohoa.com

TiffanyC (Texas)
Posts: 3

Posted:

@Mike - Thanks for the input. I will inquire at the next board meeting if we know what is owed against some of these houses. Some of them have been out right abandoned, so foreclosure would be the steps necessary to continue. Others they just aren't paying their dues. Their taxes owed are $0. Those unless they are paid off will more than likely be a lien.

Do you happen to know of a place where I could find more information on HOA foreclosure in Texas? I have looked all over Google and it's all about the evils of HOA foreclosure.

I have spoken with our County Clerk and its a simple process to file a lien, but we will still have to foreclose on some of the abandoned properties, if nothing more than just for the land.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Mike,

I was under the impression that an HOA foreclosure in TX was a rather simple process. I've been on message groups with people from TX complaining about the high rate of HOA foreclosures. There's a whole website dedicated to the number of HOA foreclosures in the Houston area. Also, I thought TX was a nonjudicial foreclosure state8 which also makes the process alot simpler.

When a mortgage co foreclosures they are only concerned with getting enough money to satisfy the mortgage balance. When an HOA forecloses, because the mortgage co will be paid first, they must try to get a seller willing to pay not only the mortgage balance but also what is owed the assn.

LynetteB (Texas)
Posts: 141

Posted:

TiffanyC,
As a small, poor HOA, I would suggest your continue with the do it yourself approach with the letters. I would suggest you use "return receipt requested" so you can get an idea who is actually receiving the notices and who isn't and also to have it for your records that you made the attempt to contact the individuals. Make sure the letters not only state the delinquency, but the steps you intend to take to collect to dues and follow that with the location in your Associations docs and/or Texas laws that give you the authority to take those steps.

We file our own liens. It cost $20 for two legal size pages. There are several specifics to follow with foreclosure and poor or not, I suggest you get a lawyer to handle it. We were told it would run approximately $800 for one type of forclosure and $1300 for the other, so you will have to decide which properties might be worth going after. If you have a way to get the message to the rest of the members, sometimes an example made of one could bring the others around. As another poster already stated, if there is a mortgage, foreclosure would be a waste of your money in most cases.

You didn't mention Texas Property Code Chapter 51, so you may want to look that over. I have some other info in .pdf form, but I don't know how to attach it here so if you want to post your email, I will send it to you.

Good Luck!

Lynette

GlenL (Ohio)
Posts: 5,491

Posted:

Tiffany, one of the things your HOA should already have in place is a collection policy which Lynette referred to outlining the steps the HOA will follow to collect delinquencies. In addition to sending it certified mail you should also send it regular post as some people will not pick up certified mail especially if they're delinquent. For a small fee you can also have a deputy serve the papers on the delinquent homeowner.

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