Additional Real Estate Litigation Focus 

Judicial Foreclosure Process in Texas



Jurisdiction & Venue: 

Petitions for judicial foreclosure must be filed in a District Court in (i) the county where the cause of action accrued, (ii) in the county of the defendant’s residence (if the defendant is an individual) or principal place of business (if the defendant is a corporation, partnership, unincorporated association, or other legal entity), (iii) in the county of plaintiff’s residence (if the plaintiff is an individual) or principal place of business (if the plaintiff is a corporation, partnership, unincorporated association, or other legal entity). Attorneys may be led to believe that the venue of a judicial foreclosure action must occur in the county in which the property is located. However, the Texas Supreme Court has held that an action to foreclose a lien does not primarily involve title to real property. Consequently, the venue is not mandatory in the county in which the land is located.

Pleadings Requirements:  

In order to obtain the relief of judicial foreclosure from a District Court, the lienholder must: (i) allege execution and delivery of a secured debt instrument, (ii) allege ownership of the debt instrument, (iii) provide a description of the property secured by the lien, (iv) allege the execution and delivery of the lien instrument (an exception is an abstract of judgment), (v) alleges the amount of the unpaid debt, and (vi) allege a default by the maker of the debt instrument. The prayer for relief in the petition should pray for the foreclosure of the lien along with a judgment against the debtor for the amount of the debt. The lienholder may recover attorneys fees are recovery of attorneys fees is provided for in the lien instrument and/or debt instrument, and pled for in the petition.

Foreclosure Judgement:  

A valid judgment foreclosing the lien must be obtained from the District Court, which should include: (i) an award of the debt owed to the lienholder, (ii) court costs and attorneys’ fees (if provided for in the lien or debt instrument), (iii) a decretal paragraph ordering the foreclosure of the lien, (iv) and a decretal paragraph directing a sheriff or constable to seize and sell the collateral of the lien in satisfaction of the debt, and (v) a decretal paragraph instructing the sheriff or constable that if the collateral does not sell for an amount sufficient to satisfy the debt that the sheriff or constable should proceed to execute on other property of the defendant as in ordinary judgment execution. Once a valid judgment foreclosing the lien has been entered by the District Court, a sale must be held in order to pass the title to a subsequent purchaser. The writ of sale should be directed to the sheriff or constable in the county in which the property is located. 

The Writ and Sale :  

The District Court clerk will issue the writ of sale upon the application of the successful party in a suit thirty (30) days after the judgment is rendered. The writ of sale must particularly describe the property and direct the sheriff to give public notice of the sale. The sale of the real property will be held at the courthouse door of the county unless the court orders that such sale shall be at the place where the real property is situated. The sale of the real property shall occur on the first Tuesday of the month, between the hours of ten o’clock, a.m. and four o’clock p.m. The sheriff must give notice of the sale in a newspaper in the county (in English) once a week for three consecutive weeks preceding the sale. The first of said notices must be published not less than twenty (20) days immediately preceding the day of sale. The notice must contain a statement of the authority by virtue of which the sale is to be made, the time of levy, the time and place of sale, a brief description of the property to be sold, the number of acres, the original survey, locality in the county, and the name by which the land is most generally known. Proceeds from the sale are applied first to the sheriff’s/constable’s cost of the sale, then to the indebtedness of the suit, and then to junior lienholders who were parties to the suit, and then the property owner.